Investors watching Tesla Motors, Inc. (NASDAQ:TSLA) stock should take a note of this: the company is ramping up its hiring. If the new hires are able to achieve what they’ve been hired for, it’s likely to boost TSLA stock.
Right now, Tesla has 1,600 open job positions and the company is aggressively looking for engineers. Why? To build autonomous cars—or in Tesla’s words, to create “Autopilot.” (Source: “Tesla Ramps Up Hiring as Rivals Loom,” The Wall Street Journal, December 28, 2015.)
Back in 2010, the electric car company had only 899 employees. Today, Tesla has grown to 14,000 employees. Moreover, according to a $15.0-million tax credit agreement with the state of California, Tesla will be expanding operations in California and is to hire more than 4,400 workers by 2019. (Source: “California Completes Tax Credit Allocation Agreement,” California Governor’s Office of Business and Economic Development, last accessed December 30, 2015.)
Tesla Stock: Hiring Hardcore Software Engineers for Autopilot
A few weeks ago, Tesla’s CEO, Elon Musk, tweeted that the company is looking for “hardcore software engineers.”
We are looking for hardcore software engineers. No prior experience with cars required. Please include code sample or link to your work.
— Elon Musk (@elonmusk) November 20, 2015
Musk then added, “I will be interviewing people personally and Autopilot reports directly to me. This is a super high priority.”
Mind you, Tesla is not the only company that has plans for driverless cars. In fact, both tech giants and auto industry heavyweights are eyeing the autonomous car business. From Silicon Valley, there’s Apple Inc. (NASDAQ:AAPL) and Alphabet Inc (NASDAQ:GOOG). In the automotive industry, there’s Ford Motor Company (NYSE:F) and Toyota Motor Corporation (ADR) (NYSE:TM) are also testing their driverless cars.
With so many players in the game, the competition is not just intense for driverless cars, but also for engineers that can develop them. According to Paul Harty, president of recruiting outsourcing company Seven Step RPO, fees paid to placement agencies for software engineers in the Bay Area have doubled in the past two years to around $30,000–$40,000 per employee.
With fees at recruiting firms rising rapidly, Elon Musk’s tweet to his 3.1 million followers looks like a great cost-effective strategy to attract new talent to Tesla. A Tesla spokeswoman remarked that “Elon’s tweet opened the gate to a new wave of exceptional candidates.”
The Bottom Line on TSLA Stock
For 2015, Tesla is on its way to selling 52,000 vehicles, but that number could grow by a lot more in the future.
The company is also building its $5.0-billion “Gigafactory” in Nevada. The factory will have the capacity to make 25 gigawatt hours of battery cells, which would be more than all of today’s lithium-ion battery plants in the world combined. Such an enormous production capacity could fulfill Elon Musk’s ambition of producing 500,000 vehicles per year by the end of the decade.
With such a huge fan base, Elon Musk’s hiring signal could attract not only engineers to Tesla, but also investors to TSLA stock.