Tesla CEOs Drew Baglino and Rohan Patel are leaving because the company is laying off 10%

Drew Baglino, Tesla’s SVP of Powertrain and Energy, and Rohan Patel, VP of Public Policy and Business Development, have left the company, Patel told JS. Patel said he decided to leave because of “[b]ig general changes” at the company that he declined to specify. Their departure was first reported by Bloomberg.

“Good for me and hopefully good for Tesla too,” Patel said in a message to JS. “I’ve had a great run and accomplished far more than I ever imagined, as a result of working with the best policy/bizdev team in the industry.” Baglino said in a post on X that it was a “difficult decision” to leave Tesla after 18 years.

Their departure comes as Tesla lays off thousands of employees in an effort to cut costs and increase productivity, according to an internal email sent to employees by CEO Elon Musk. Electricity And Bloomberg News first reported. The electric car maker is cutting “more than 10%” of its global workforce, Musk said in the email. Tesla ended 2023 with more than 140,000 employeesThis means that the cuts could affect more than 14,000 people.

Musk announced the layoffs just two weeks after Tesla reported its first year-over-year sales decline in three years, amid a broader cooling in demand for electric vehicles. The company has warned investors that revenue growth in 2024 could be “significantly lower” than its stated target of 50% annual growth. It’s also somewhat between product cycles for the first time in years, with the expensive Cybertruck only recently entering production and the popular Model Y entering its fourth year without any significant updates.

“As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the business to reduce costs and increase productivity,” Musk said in the email. Tesla’s growth, he said, has led to “duplication of roles and functions in certain areas.”

“As part of this effort, we have conducted a major overhaul of the organization and made the difficult decision to reduce our global workforce by more than 10%. There’s nothing I hate more, but it has to be done. This will allow us to be lean, innovative and hungry for the next growth phase cycle,” Musk wrote.

Baglino’s departure marks the second time a top executive has left the company in the past year, as Tesla CFO Zachary Kirkhorn stepped down in August 2023. Baglino oversaw the engineering of the company’s powertrain and battery technologies. He had also become one of the most responsive executives on Musk’s social media platform X. Patel, who served as a longtime special assistant to President Barack Obama and adviser on climate and energy, has similarly interacted with Tesla customers and fans in recent months. .

Tesla shipped a record 1.8 million electric vehicles in 2023. But the company spent much of the year cutting prices on its most popular models in an effort to offset the impact of high interest rates and increased global competition. The company has also reportedly dropped (or at least postponed) plans to build a cheaper electric car that would retail from around $25,000, opting instead to keep the underlying platform under development use to power a purported robotaxi that Musk said will debut. on August 8.

This story and headline have been updated with news of the departures of Drew Baglino and Rohan Patel.