Tesla (NASDAQ:TSLA)’s latest round of layoffs, which reportedly includes staff from various departments such as software, service, and engineering, underscores the ongoing challenges faced by the electric vehicle (EV) maker amidst a shifting landscape in the automotive industry.

The decision to reduce its workforce further follows Tesla’s recent announcement of disbanding its EV charging department and cutting more than 10% of its global workforce. This move reflects the company’s efforts to streamline operations and control costs amid a backdrop of dropping sales and increasing competition in the EV market.

While Tesla’s shares saw a modest increase following the news, the company has not yet responded to requests for comment from Reuters, leaving the exact details of the layoffs unclear.

The anticipated costs associated with the layoffs, expected to exceed $350 million in the second quarter, suggest a significant restructuring effort by Tesla. This restructuring includes the departure of several top executives, signaling a broader reorganization within the company.

Despite these challenges, Tesla remains committed to innovation and efficiency, as evidenced by its ongoing development of new models using existing platforms and production lines. This strategic approach aims to optimize capital expenditures while continuing to expand Tesla’s product lineup.

As Tesla navigates these transitions, the company’s ability to adapt to market dynamics and maintain its position as a leader in the EV industry will be closely watched by investors and industry observers alike.