Elon Musk Apologizes For Underpaying Laid-Off Workers But Still Demands His Own $56 Billion Pay Day
Good morning! It’s Thursday, April 18, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
Walter Isaacson On Elon Musk(s)
1st Gear: Elon Musk Actually Apologizes For Something
Elon Musk said some of the severance packages received by recently laid-off Tesla employees when it cut 10 percent of its staff were too low. Right now, it isn’t clear how many employees were affected by the far-too-low severance packages. From Bloomberg:
“As we reorganize Tesla it has come to my attention that some severance packages are incorrectly low,” Musk said in a short email sent to employees on Wednesday and seen by Bloomberg News. “My apologies for this mistake. It is being corrected immediately.”
[…]
The email is a rare show of contrition from Musk, who’s contending with lawsuits brought by former Twitter employees and executives over severance. Earlier this week, the billionaire announced Tesla would slash global headcount by more than 10% as the carmaker struggles with slowing demand for electric vehicles.
In typical Tesla fashion, the job cuts were done in anything but a smooth manner. We recently reported how some employees didn’t find out they were laid off until trying to use their key cards at Tesla facilities.
“Tried to badge in, and the security guard took my badge and told me I was laid off,” Nico Murillo, a former production supervisor, wrote on LinkedIn. “Sat in my car in disbelief.”
Some departments were hit harder than others, according to Bloomberg. Apparently, some divisions saw cuts closer to 20 percent.
Following the layoffs, a number of senior executives, including Drew Baglino, senior vice president of powertrain and electric engineering and Rohan Patel, vice president of public policy and business development, resigned from the automaker.
This latest misstep from Tesla regarding pay comes just days after Musk demanded his $56 billion payday for running the company.
2nd Gear: Rivian Cuts Another 1 Percent Of Its Workforce
Rivian is carrying out its second round of layoffs this year. Now, another 1 percent of its workforce is heading to the chopping block as the nascent automaker deals with lower-than-expected customer demand. From Bloomberg:
“We continue to work to right-size the business and ensure alignment to our priorities,” the company said in an emailed statement. “This was a difficult decision, but a necessary one to support our goal to be gross margin positive by the end of the year.”
The move comes about two months after Rivian slashed 10% of its salaried staff as high interest rates and economic headwinds compounded the company’s ongoing challenges with scaling production. The prior round of cuts focused on product teams and those working on its commercial EV business, while the latest move will mostly affect support and back-office workers.
As of December 31, Rivian had a 16,790-person headcount across the company. Some simple math would suggest a 1 percent cut means about 150 to 160 jobs are being eliminated.
It’s a tough time for EV makers right now. I mean, Tesla, the biggest one of them all, just had to cut 10 percent of its staff, and you’d know that if you read First Gear.
3rd Gear: EU Car Sales Hit 16-Month Low
March registrations of new vehicles in the European Union dropped more than they have in over a year. It’s not exactly a shocker due to the Easter holiday and the demand for new cars softening overall. It’s making life for automakers anything but easy. From the Wall Street Journal:
The bloc’s new-car registrations, which mirror sales, fell 5.2% on year—the largest monthly drop since November 2022, when sales dipped 6.1%, according to the European Automobile Manufacturers’ Association.
The industry group, known as ACEA, said Thursday that the Easter holiday hurt sales, though analysts expect a down year for the auto industry amid high borrowing rates for consumers.
Registrations fell in each of the EU’s largest economies, led by Germany with a 6.2% decrease, ACEA said.
Registrations of fully electric vehicles also slipped 11 percent, which is about on pace with the rest of the world. In the EU, EVs also lost some of their market share to internal combustion-powered vehicles. They made up just 13 percent of the EU’s total registrations in March, down from 14 percent a year ago.
4th Gear: 456,565 Mavericks, Bronco Sports Recalled
Ford is recalling 456,565 Mavericks and Bronco Sports in the U.S. because of a loss of drive power caused by a low battery issue, according to the National Highway Traffic Safety Administration. From Reuters:
An undetected low battery charge could lead to some electrical accessories such as hazard lights not functioning properly or cause a loss of drive power in affected vehicles, according to the NHTSA.
The recall includes Bronco Sport SUVs manufactured between 2022 and 2024, and Maverick compact pickup trucks made between 2022 and 2023, the auto safety regulator said.
The fix seems to be a fairly simple one, according to NHTSA. Dealers will apparently recalibrate the body control and powertrain modules to remedy the issue.
It’s another page in Ford’s recent lengthy recall issue. Ford was the most recalled automaker in the United States in 2023, and right now it seems to be on pace to repeat that dubious claim to fame in 2024.
This is also the second Bronco Sport recall in the last week or so. Last week, we reported that 22,270 examples of the lil’ Bronc were recalled for having possibly cracked fuel injectors. The news came just days before famous Bronco owner OJ Simpson was recalled by the great creator.
Reverse: The Earthquake In New Jersey A Few Weeks Ago Was More Extreme IMO
Neutral: I Still Miss This Little Red Truck
The 2024 Nissan Frontier Hardbody Edition Is Retro Done Right
On The Radio: The 1975 – “Milk”
The 1975 – Milk
