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In the world of cold business dealings, the story of Tesla Motors recent cuts strikes particularly cruel

DailyTech previously covered the hot, but pricey Tesla Roadster, among the first of the next generation of electric cars which the Chevy Volt and others will soon be joining.  The Tesla Roadster was the product of Tesla Motors, a bright seeming startup with big dreams.  Despite the $100,000 price tag, hopes for the company are high.

Now Tesla Motors employees are finding the hard reality of the sagging economy is catching up to their company.  And worse yet in perhaps a sign of things to come, the company for which they had loyally worked has delivered them a particularly stinging rejection.

Corporate layoffs are nothing new.  Yahoo is contemplating more cuts, and Sprint and CNET were among others who made cuts earlier in the year.  Still, the layoff of roughly 90 percent of Tesla Motors work force at its Michigan location in Rochester Hills, 30 minutes north of Detroit stands out as unique and disturbing.

Workers at Tesla Motors showed up to work, just like any other day.  Some of them, unsurprisingly avid readers of auto-blogs took a quick peak on the internet to catch up with their morning news.  That's when a couple employees noticed that a story on auto-blog ValleyWag had news of Tesla Motor layoffs.  And the blog Jalopnik followed up that the layoffs would be taking place that day in Rochester Hills.

Logging on their own company site, sure enough it read that they were being laid off and were now obsolete.  Apparently no one had considered it a good idea to send them that memo, though.  Roughly 90 percent of the employees at the location received pink slips.  Tesla is reportedly cutting up to 100 employees, roughly half its workforce.  They're also demoting their CEO and replacing him. 

The few employees that weren't cut perhaps suffered an even worse fate.  They were ordered to relocate to Tesla Motor's San Jose headquarters and pay for the expense of the move themselves.  They would receive no increase in compensation.  Worst of all the company offered no help in selling their employees' homes, which will likely be a painful task amid Detroit's ravaged real estate landscape.

Perhaps most ironic of all was the pink slip message the employees being cut received.  The message read:

There will also be some headcount reduction due to consolidation of operations. In anticipation of moving vehicle engineering to our new HQ in San Jose, we are ramping down and will close our Rochester Hills office near Detroit. Good communication, tightly knit engineering and a common company culture are of paramount importance as Tesla grows.

While we certainly haven't seen the last of Tesla Motors, one certainly wonders if they can survive the rigors of the current economic climate with such a curious definition of "good communication."

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RE: Big mistake
By rippleyaliens on 10/18/2008 1:07:58 AM , Rating: 1
Classic case, of building Ferrari $$$ cars, in a economy that is buckling over ford escort prices.
Being fired via email is nothing new. Sarcom bought Vanstar to become a HUGE MEGA IT company. in less than a year, they went bankrupt, and fired people via email, and voice message.
This happens.
What is bad, is that the real estate in Mich, especially rochester hills is horrriiibbblleee. They are gonna loose their shirts... Moving to San Jose, lol. even worse..Getting a tech job there is hard enough, letalone this. Now factor in, that re-locating cost, with kids, clothes, and house hold items. we are talking min $3500.. just to move. (single person/small family). 2Br apts in San Jose are in the 1300-1500 range, EASILY, and in apts that are no where near Michigan (however crummy)..

Then there is no guarantee of employment with Telsa anyway.
Moving out of Detroit area was actually a smart idea, Detroit is dying.. Detroit plants are closing left/right.

RE: Big mistake
By onelittleindian on 10/18/2008 1:58:13 AM , Rating: 2
Detroit plants are closing left/right.
Yep, killed by the UAW and the overly-taxing and restricting Michigan State Govt.

When are people ever going to figure out that when you treat businesses like piggy banks (when you're not treating them like mortal enemies) that they're either going to eventually move or just wither up and die?

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