Recent job cuts at Tesla Inc.'s (TSLA - Get Report) Las Vegas mega-factory are a reflection of slowing demand for the automaker's all-electric luxury vehicles, particularly the lower-priced Model 3 sedan, Reuters reported.
Citing two laid-off employees no longer employed by Tesla, Reuters reported that about 150 employees out of a team of about 230 were laid off from the company's Las Vegas facility last month - the plant that produces Tesla's Model 3 for U.S. and Canadian buyers.
The previously un-reported cuts, disclosed by Reuters, could fuel investors' concerns that demand for the Model 3 in North America has tapered off due to the car's still-high price tag and lapse of government incentives.
"There are not enough deliveries," one of the former employees told Reuters. "You don't need a team because there are not that many cars coming through."
Tesla has seen its share of criticisms in the past 12 months, first amid concerns it wasn't able to produce Model 3s fast enough to fulfill pre-orders for the car and later because it appeared demand had tapered off because of the higher-than-promised price tag and lapsing tax credits.
In the U.S., a $7,500 tax credit has been halved to $3,750 for the first six months of 2019 and will drop again in the second six months of the year. In Canada, federal and most provincial tax incentives have been eliminated outright.
Shares of Tesla were up 2.3% to $312.84 after Canaccord Genuity lifted its recommendation on the stock to buy from hold and raised its price target to $450 from $330.