Elon Musk has a 'super bad feeling' about the economy and wants Tesla to cut jobs

Brittany Cronin

June 03, 2022 / 10:44 am

caption: Tesla CEO Elon Musk speaks during the official opening of the new Tesla electric car manufacturing plant near Gruenheide, Germany, on March 22. Musk reportedly wants to lay off 10% of staff because of his worries about the economy.

Tesla CEO Elon Musk has a "super bad feeling" about the economy – so much so that he's directing company executives to freeze hiring and cut staff, according to an internal email seen by Reuters.

In the email reportedly titled "pause all hiring worldwide," Musk said Tesla needs to cut its staff by around 10%.

The company did not respond to a request for comment.

Musk's email comes at a time when stock markets have tumbled this year over fears the U.S. economy is headed to a recession as the Federal Reserve raises interest rates aggressively to fight high inflation.

President Biden weighed in on Musk's comments on Friday.

"You know, lots of luck on his trip to the moon," Biden said when asked by reporters.

Musk later replied with a retort of his own, thanking Biden in a tweet.

Other CEOs also worry about the economy

Other CEOs have recently expressed concerns about the economy, with JPMorgan Chase CEO Jamie Dimon this week predicting an economic hurricane.

"Right now it's kind of sunny, things are doing fine. Everyone thinks the Fed can handle this," Dimon said at an investment conference. "That hurricane is right out there down the road coming our way."

"We just don't know if it's a minor one or Superstorm Sandy. You better brace yourself," Dimon added.

The concerns come even as the labor market stayed strong, with data earlier on Friday showing U.S. businesses added 390,000 jobs in May, while the unemployment rate held steady at 3.6%.

Musk's bad feeling about the economy comes as electric car sales in the U.S. and globally are on the rise, allowing Tesla to post record profits in the first quarter.

But Tesla faces ongoing supply chain and production challenges stemming from the pandemic.

Tesla's Shanghai factory was shut down due to the pandemic earlier in the year, significantly impacting its overall production.

Musk's email comes after a series of leaked emails this week showed the Tesla CEO demanding its employees return to the office for in-person work for at least 40 hours per week or risk being fired. [Copyright 2022 NPR]