Electric vehicle maker Tesla Inc. is planning more than 10% reduction in global workforce amid slower EV demand, reports said citing a memo sent by CEO Elon Musk to all employees. According to Musk, duplication of roles as well as the need for cost reductions are the reasons behind the decision.

Following the news, Tesla shares were losing around 1.3 percent in pre-market activity on the Nasdaq, to trade at $168.90.

The proposed job cuts at the world’s largest EV maker is likely to impact around 14,000 staff. Earlier, Electrek had reported that Tesla was preparing for massive layoffs as high as 20 percent of the workforce.

Tesla’s global employee strength was around 140,000 in early 2024, significantly higher than the 38,000 employees it had in early 2018. Back in 2017, Tesla had reduced its headcount by 2 percent. Since then, the company has cut jobs in 2018, 2019 and 2022.

Musk said the planned cut would enable it to be lean, innovative and hungry for the next growth phase cycle.

For the retaining employees, he said, “We are developing some of the most revolutionary technologies in auto, energy and artificial intelligence. As we prepare the company for the next phase of growth, your resolve will make a huge difference in getting us there.”

The news comes on the heels of Tesla’s announcement over the weekend that it would shorten Cybertruck production shift at Gigafactory Texas.

The company on Friday had announced a substantial price cut for its Full Self-Driving or FSD Supervised subscriptions in the U.S.

The carmaker has been struggling of late amid weak demand and tough competition.

Early this month, Tesla had reported weak production and deliveries in its first quarter, partially due to the early phase of the production ramp of the updated Model 3 at Fremont factory and factory shutdowns resulting from shipping diversions caused by the Red Sea conflict and an arson attack at Gigafactory Berlin.

In late March, Bloomberg reported that Tesla has cut down its electric vehicle production at its Giga Shanghai factory in China due to sluggish growth in the sales of new-energy vehicles, tough competition and price war. Tesla had also limited manufacturing of EV parts.

Tesla is facing tight competition from domestic automakers in China, and a similar low demand in the U.S. and Europe.

Meanwhile, reports said that Tesla is in talks with Indian conglomerate Reliance Industries Ltd. to form a joint venture to build a manufacturing plant in India.