Tesla heads are rolling over critical projects at Gigafactory Texas

While Tesla is conducting broader layoffs, Electrek is learning that heads are rolling at Tesla over specific critical projects at Gigafactory Texas.

Tesla announced today that it is laying off over 10% of its workforce. The automaker is again using “hiring inefficiencies due to rapid growth” as the reason for the layoffs.

However, Electrek is learning that Tesla is also using this round of layoffs to clean house on some projects in Austin, Texas.

We previously reported that Tesla’s SVP of Powertrain and Energy Engineering, Drew Baglino, left the company today.

Baglino was leading many engineering projects at Tesla, including the 4680 battery cell production and the cathode factory at Gigafactory Texas in Austin. Those two projects have seen serious delays.

Sources familiar with the matter have told Electrek that Tesla has also let go of Anthony Thurston, Senior Manager of Cathode Materials & Manufacturing at Tesla, who was reporting to Baglino regarding the cathode factory project.

A person familiar with the project described it to Electrek as “a financial black hole.”

The factory is meant to supply Tesla with processed cathode material for its own battery cell production at Gigafactory Texas.

Elon Musk is reportedly unhappy with the progress at the plant, and heads are rolling. It’s unclear if Baglino was let go or left on his own amid the layoffs. Electrek reached out to Baglino, but we didn’t get a response.

Musk also pushed for other changes at Gigafactory Texas.

We reported earlier today that he shut down a project called NV9 to build a next-gen cheaper electric vehicle at the plant. Instead, Musk asked for all resources to go into the Robotaxi program and, specifically, a new data center to be built in an ongoing expansion at the factory.

Sources familiar with the matter told Electrek that the project is behind schedule. Musk is accelerating the project’s timeline to be ready to turn on the data center by August 20th, but this is what it looks like right now.

The timeline was already ambitious, but the CEO has accelerated it amid some of the toughest months for construction in Austin. The project is expected to experience rain and wind delays on top of the logistic challenges of supplying the computing and power electronic hardware to build the data center.

Several people involved in the project were also let go, according to sources familiar with the matter, including Amir Mirshahi, director of infrastructure at Tesla Gigafactory Texas.

Individuals involved with the project referred to it as ‘Dojo,’ which is what Tesla calls its own supercomputer program, but two people familiar with this data center project said that it would use NVIDIA hardware.

We previously reported that Tesla let go of its Dojo leadership in December 2023.

Earlier this year, Tesla announced that it is building a $500 million Dojo supercomputer cluster in New York.

Tesla aims to use the new computing power from this New York project and this Gigafactory Texas project to train its AI for self-driving. Tesla plans to unveil its Robotaxi on August 8th.

Electrek’s Take

Tesla and Elon are pushing the narrative that the layoffs are due to “hiring inefficiencies due to rapid growth”, but there’s definitely more to it.

This is leading some Tesla fans to claim that “Tesla is just trimming the fat” and “firing the bottom 10% of performers”, but again, there’s more to it.

It looks like Elon is unhappy with some of Tesla’s programs and cleaning house, for better or worse. The layoffs sort of hide the programs being killed and the resources moving around or not needed anymore.

I want to be clear that I disagree with the characterization that people being let go at Tesla this week are not good at their jobs. It might be the case in some cases, but there can be a lot of factors that result in a program not working, and Elon himself can be a factor at times. He is known to move the goal post.

Tesla’s needs are changing because Elon is changing his mind on things.

In short, Elon is putting all of Tesla’s eggs in the same basket and that basket is called self-driving.

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