Tesla Inc. (NASDAQ:TSLA) has reportedly instructed workers on Model Y and Cybertruck production lines at its Austin factory to stay home during Memorial Day week, marking an unusually extended break as the automaker grapples with declining deliveries.
What Happened: Workers, who are paid hourly, were notified earlier this week that they could either use paid time off or report for cleaning and training duties, but wouldn’t work on production lines. Employees indicated production schedules have been increasingly inconsistent since February, with many sent home early multiple times, three employees told Business Insider.
The production pause follows Tesla’s first-quarter delivery decline of 13% year-over-year and comes amid mounting inventory concerns. The company produced nearly 26,000 more vehicles than it delivered in the first quarter, despite already reducing production by approximately 100,000 units compared to the previous quarter.
Tesla did not immediately respond to Benzinga‘s request for comment.
Why It Matters: “If the ship of America goes down, Tesla will go with it,” CEO Elon Musk warned during an April earnings call after the company reported a 71% plunge in net income to $409 million. Tesla’s core automotive revenue tumbled 20% to $14 billion.
Cybertruck has faced particular challenges, with reports suggesting over 10,000 units remain unsold. The company has delivered fewer than 50,000 Cybertrucks as of March, according to a voluntary recall notice.
The company has introduced discounts on the refreshed Model Y launched in January and released a cheaper variant this week as it attempts to stimulate demand.
Price Action: Tesla’s stock closed at $298.26 on Friday, up 4.72% for the day. In after-hours trading, the stock rose slightly to $299.29, gaining an additional 0.35%. Year to date, Tesla shares are down 21.36%, according to data from Benzinga Pro.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
