Is there trouble brewing in Palo Alto? After recently admitting to “manufacturing bottleneck issues” for the Model 3, it has been reported that luxury electric vehicle maker Tesla has fired around 400 staff this week. The total includes associates, team leaders and supervisors, a former employee told Reuters.

The sackings were a result of a company-wide annual review, Tesla said in an emailed statement, without confirming the number of employees allowed to leave. “It’s about 400 people ranging from associates to team leaders to supervisors. We don’t know how high up it went,” the former assembly line employee said.

Tesla cited staff performance as the reason for the dismissals, but the news agency’s source he was fired despite never having been given a bad review. The mass firing was first reported by Mercury News, which covers the Silicon Valley.

Earlier this month, Tesla released its third quarter 2017 results, which showed deliveries rising 4.5% year-on-year, and 17.7% up on the previous quarter. However, the company only managed to make 260 units of the much hyped Model 3, delivering just 220 of the entry level model, which starts from $35,000 (RM147,581).

Tesla admitted that it is facing production bottlenecks for the Model 3, and is behind an ambitious schedule. “It is important to emphasise that there are no fundamental issues with the Model 3 production or supply chain. We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near term,” the company said in a statement.

The original plan was “to achieve a rate of 5,000 Model 3 vehicles per week by the end of 2017,” according to the EV specialist’s second quarter financial report. Tesla also previously said that it expects at some point in 2018 to further ramp to a rate of “10,000 Model 3 vehicles per week,” and an annual production rate in excess of 500,000 vehicles.

Tesla has since said that a handful of systems at its Fremont plant in California and its battery factory in Reno, Nevada, “have taken longer to activate than expected.”