FRANKFURT, June 3 (Reuters) - Tesla (TSLA.O) Chief Executive Elon Musk
told top managers he had a "super bad feeling" about the economy and
that the electric carmaker needed to cut staff by about 10%, according to an
internal email seen by Reuters.
The
email, titled "pause all hiring worldwide", was sent to Tesla
executives on Thursday, underscoring an increasingly gloomy global economic
outlook with prices soaring and war in Ukraine passing its 100th day.
The message from Musk came shortly
after Jamie Dimon, chairman and chief executive of JPMorgan Chase (JPM.N), said the U.S. economy faced
challenges akin to a "hurricane".
Here
is reaction to the comments:
FRANK
SCHWOPE, AUTOMOTIVE ANALYST WITH NORDLB:
"I
see the statements as a forewarning ... in case the economy takes a turn for
the worse."
"All
car manufacturers are facing many problems at the moment: supply chain issues
due to (coronavirus) and the Ukraine war, closures in China, supply shortages
and so on."
"Since many plants have not been
working at full capacity since the (coronavirus) pandemic began, planned
cost-cutting measures by the car companies are quite understandable."
FIONA CINCOTTA, SENIOR FINANCIAL
MARKETS ANALYST, CITY INDEX, LONDON
"Although
the Fed thinks a soft landing is possible ... there are some warning signs in
the economy. We know that growth is slowing and inflation remains persistently
high and we know that the Fed will need to act aggressively to bring inflation
back down."
"The question is - will they be
able to act as aggressively as they need to, and obviously Elon Musk doesn't
think that they're going to be able to, without putting the economy into a deep
recession. China slowdown is an added problem."
LORENZO
CODOGNO, HEAD OF LC MACRO ADVISERS AND FORMER CHIEF ECONOMIST AT THE ITALIAN
TREASURY:
"It
is clear that rising prices will weaken consumption. That is something we'll
need to face."
"If
the inflation flare-up ... starts fading at the beginning of next year ... we
will probably not see as dramatic an impact on the global economy as Musk seems
to indicate."
"And
if the shock is temporary, companies will probably have an interest in ... not
losing human capital."
DANIEL IVES, MANAGING DIRECTOR AND
SENIOR TECH ANALYST, WEDBUSH SECURITIES
"Street
will clearly read this message negatively at first blush," Ives wrote on
Twitter.
"Elephant
in the room now remains the radio silence on Twitter deal. Musk more negative
on economy, what’s next in Twitter saga."
CARSTEN BRZESKI, GLOBAL HEAD OF
MACROECONOMIC RESEARCH, ING
"Musk's
bad feeling is shared by many people."
"We're
talking about stagnation and a global economy which has to go through
significant structural change, such as decarbonisation, deglobalisation and
adjusting to older societies."
"But
we are not talking about global recession. We expect a cooling of the global
economy towards the end of the year. The U.S. will cool off, while China and
Europe are not going to rebound."
"Laying
off workers, however, is not the best reaction. We will need skilled workers
more than ever in the future. This could turn into firing and then
hiring," he said.
FRANCOIS SAVARY, CHIEF INVESTMENT
OFFICER, PRIME PARTNERS
"At
the end of the day it's easy to make such comments. Everyone has fears but
there is no sign yet to justify such a negative outlook."
"There
is a risk of recession yes ... but ... you need to see numbers heading in that
direction and so far there are none."
"It
will depend a lot on what happens in the labour market. If we have a
significant deterioration of U.S. labour markets over the summer, then ...
there is a risk of recession next year."
Source:Reuter