AUSTIN, Texas — It was announced last week that following dismal first-quarter sales, Tesla is planning to lay off about a tenth of its workforce in order to cut costs.

On Tuesday, it was determined that the layoffs will affect 2,688 workers at Gigafactory Texas in Austin.

What You Need To Know

  • Tesla will lay off 2,688 workers from its gigafactory in Austin, Texas, beginning in June

  • This comes after it was reported last week that the automaker is laying off about a tenth of its workforce in order to cut costs

  • The Texas layoffs will occur during a 14-day period beginning on June 14

  • Tesla sales fell sharply last quarter as competition increased worldwide, electric vehicle sales growth slowed, and price cuts failed to draw more buyers

The news comes from the Texas Workforce Commission via a Work Adjustment & Retaining Notification, or WARN notice, it received from Tesla.

TWC reported the layoffs will occur during a 14-day period beginning on June 14. Affected workers are not protected by a union and do not have bumping rights. Bumping rights allow more senior-level employees whose positions have been eliminated or are designated for layoff to accept an alternative position currently occupied by a less-senior employee.

Gigafactory Texas produces Model Y cars and is intended to be the main factory for the Cybertruck as well as Tesla’s next-generation vehicle.

CEO Elon Musk detailed the plans in a memo sent to employees last week. The layoffs could affect about 14,000 of the 140,473 workers employed by the company at the end of last year.

Musk's memo said that as Tesla prepares for its next phase of growth, “it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” The New York Times and CNBC reported. News of the layoffs was first reported by the electric vehicle website Electrek.

Tesla sales fell sharply last quarter as competition increased worldwide, electric vehicle sales growth slowed, and price cuts failed to draw more buyers. The company said it delivered 386,810 vehicles from January through March, nearly 9% below the 423,000 it sold in the same quarter of last year.