ElNono
10-17-2008, 03:12 PM
LINK (http://www.mercurynews.com/cars/ci_10727401)
Tesla Motors announces layoffs; Musk to assume CEO post
Tesla Motors is putting its Model S sedan on hold, closing the Michigan facility that was working on some of the sedan's engineering and laying off an unspecified number of people, the company confirmed Wednesday.
Tesla told San Jose officials that it will focus on selling its Roadster and power trains, and that it still intends to build a plant and its headquarters in San Jose, although the schedule may slip a bit.
Production of the Model S in San Jose will be pushed back six months, to mid-2011, said company founder Elon Musk, who also announced that he will assume the role of chief executive officer. He replaces Ze'ev Drori, who becomes vice chairman and continues as a board member.
There are 30 people working at Tesla's Rochester Hills, Mich., facility, according to a company spokeswoman. The Model S is a five-passenger, four-door luxury car. Its exterior and power train are completed, but the Michigan plant was working on its engineering.
A blog post by Musk on Wednesday blamed the credit crunch for the decision.
"These are extraordinary times,'' Musk wrote. "The global financial system has gone through the worst crisis since the Great Depression, and the effects are only beginning to wind their way through every facet of the economy. It's not an understatement to say that nearly every business will be impacted by what has unfolded in the past weeks, and this is true for Silicon Valley as well.''
Musk said the company's goal is to become cash-flow positive in six to nine months. To do that, it is ramping down the Michigan facility "in anticipation'' of moving vehicle engineering to San Jose, Musk said in his blog. The company will focus on selling its Roadster and power trains.
Instead of trying to raise capital in private markets for the Model S, the company has decided to wait for a federal Department of Energy loan guarantee "at a very low cost'' of capital, Musk said. First, the company must receive environmental approval for its planned 89-acre San Jose plant, which Musk said he expected in the second quarter of 2009.
One Web report Wednesday said half of Tesla's staff would be pink-slipped, but the company denied that. It declined to announce a number, saying a head-count review was still under way, but Musk called the reduction "modest." Tesla employs 250 people.
The situation raises eyebrows in San Jose, which recently landed Tesla's factory, as Mayor Chuck Reed announced a North San Jose location with Drori and Musk in a well-publicized ceremony.
Musk told Reed's staff of the layoffs Wednesday morning. Reed said he understands the decision to trim the company's staff is related to the global credit crunch, but that it won't affect plans in San Jose.
"We're glad they're not going to be a fatality in this credit crunch,'' Reed said.
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I wanted to post this, since we talked about these guys when the oil prices were out of control.
Tesla Motors announces layoffs; Musk to assume CEO post
Tesla Motors is putting its Model S sedan on hold, closing the Michigan facility that was working on some of the sedan's engineering and laying off an unspecified number of people, the company confirmed Wednesday.
Tesla told San Jose officials that it will focus on selling its Roadster and power trains, and that it still intends to build a plant and its headquarters in San Jose, although the schedule may slip a bit.
Production of the Model S in San Jose will be pushed back six months, to mid-2011, said company founder Elon Musk, who also announced that he will assume the role of chief executive officer. He replaces Ze'ev Drori, who becomes vice chairman and continues as a board member.
There are 30 people working at Tesla's Rochester Hills, Mich., facility, according to a company spokeswoman. The Model S is a five-passenger, four-door luxury car. Its exterior and power train are completed, but the Michigan plant was working on its engineering.
A blog post by Musk on Wednesday blamed the credit crunch for the decision.
"These are extraordinary times,'' Musk wrote. "The global financial system has gone through the worst crisis since the Great Depression, and the effects are only beginning to wind their way through every facet of the economy. It's not an understatement to say that nearly every business will be impacted by what has unfolded in the past weeks, and this is true for Silicon Valley as well.''
Musk said the company's goal is to become cash-flow positive in six to nine months. To do that, it is ramping down the Michigan facility "in anticipation'' of moving vehicle engineering to San Jose, Musk said in his blog. The company will focus on selling its Roadster and power trains.
Instead of trying to raise capital in private markets for the Model S, the company has decided to wait for a federal Department of Energy loan guarantee "at a very low cost'' of capital, Musk said. First, the company must receive environmental approval for its planned 89-acre San Jose plant, which Musk said he expected in the second quarter of 2009.
One Web report Wednesday said half of Tesla's staff would be pink-slipped, but the company denied that. It declined to announce a number, saying a head-count review was still under way, but Musk called the reduction "modest." Tesla employs 250 people.
The situation raises eyebrows in San Jose, which recently landed Tesla's factory, as Mayor Chuck Reed announced a North San Jose location with Drori and Musk in a well-publicized ceremony.
Musk told Reed's staff of the layoffs Wednesday morning. Reed said he understands the decision to trim the company's staff is related to the global credit crunch, but that it won't affect plans in San Jose.
"We're glad they're not going to be a fatality in this credit crunch,'' Reed said.
----------------------------------------------------------------------
I wanted to post this, since we talked about these guys when the oil prices were out of control.