Elon Musk has long defied the skeptics as he went on to build a solar, space ship and have an electric car company. In the process, shares of his company Tesla (TSLA) have both defied gravity and befuddled the bears.
But, it seems that the company is now facing some operational realities with cracks are beginning to show in the business.
On Friday, Tesla’s shares plunged 12% — it’s largest one day drop in over year, to $302 per share after the company announced plans to lay off 7% of its workforce.
This is the second round of job cuts since June and also comes on the heels of the company being forced to cut prices on its vehicles to compensate for a reduction in U.S. tax incentives for buyers, which will eventually be phased out. It’s slated to happen in May of this year.
Strangely enough, it was just two quarters or so ago when Tesla announced, in terms of layoffs, that Elon Musk said, “I also want to emphasize that we are making this hard decision now so that we never have to do this again.”
Too Expensive, Too Little Demand
The usually upbeat Musk took a decidedly more dour tone in this latest message writing, “our products are still too expensive for most people. It seems we likely have burned through accumulated higher priced orders, exposing…
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