Matt Higgins, CEO of RSE Ventures, voiced his concerns regarding Elon Musk's leadership style following significant layoffs at Tesla Inc. (NASDAQ:TSLA).

What Happened: Higgins suggested that Musk's decision to downsize, while potentially justified due to market demand issues, reveals flaws in his leadership.

"The part that is showing cracks in his leadership style is this cultural immaturity around some of his behaviour," Higgins said on CNBC's "Last Call" on Wednesday.

He elaborated that layoffs often leave a cultural insecurity and employees tend to underperform when they are constantly worried about getting laid off.

Higgins also criticized Musk's lack of empathy amid the layoffs.

"At the end of the day, as a leader when you have to make these difficult decisions, you have to demonstrate that it was a hard choice. And I think using a word like 'hardcore cost-cutting' is the opposite of empathy."

Why It Matters: The layoffs at Tesla began in mid-April, with the company reportedly laying off over 10% of its global workforce to cut costs and eliminate duplicate roles.

Shortly after, two more senior executives from Tesla, including the heads of its charging infrastructure and new product departments, left the company as Musk sought to downsize the workforce further.

Musk announced plans for the company's charging infrastructure segment after the departure of its head, Rebecca Tinucci. He stated that Tesla still plans to grow the Supercharger network, but at a "slower pace for new locations."

Price Action: On Wednesday, Tesla stock closed at $179.99 as per Benzinga Pro. The stock has been fluctuating between a 52-week low of $138.8025 and a high of $299.29.

Image via Shutterstock

Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.