Musk explained that the job cuts are part of a restructuring, adding that the layoffs should help reduce costs and finally make the company profitable.
In his email, Musk said the layoffs primarily affected salaried positions and will not affect Model 3 production. We made these decisions by evaluating the criticality of each position, whether certain jobs could be done more efficiently and productively, and by assessing the specific skills and abilities of each individual in the company.
"Given that Tesla has never made an annual profit in the nearly 15 years since we have existed, profit is obviously not what motivates us", according to the email.
The company is making the move now so it never has to do it again, he wrote.
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Sometimes going into a big tournament is about not losing and being passive but, for us, it's about playing attacking football. We are just trying to improve every day we work together. "We definitely don't have that divide in the team any more".
It is worth noting that the email also comes following several weeks of press reports outlining the vehicle company's troubles and predicting exactly what has happened - the need to cut costs while keeping production moving as fast as possible.
Excluding items, Tesla had a loss of $3.35 (£2.45) per share. Tesla has never been profitable in its 15-year existence.
Shares of electric automaker Tesla rose during Tuesday's trading session after one Wall Street firm raised its Model 3 production estimates by 50%.
Layoffs reportedly began on Monday and are expected to continue throughout the week.
Tesla told CBC News that it had over 42,000 employees around the world.
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The Tesla-branded kiosks were created to educate consumers and ultimately generate sales of its residential rooftop solar panels and Powerwall, a battery it designed for homes that store the energy generated by solar panels.
While confirming that no factory or production employees would be cut, the company did not clarify how much the move would save.
Consumer Edge Research Analyst James Albertine wrote in a note to investors that he views the moves "as a positive in helping Tesla track toward profitability later this year".
"It is very hard to say goodbye", Musk said in the letter.
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