Tesla (TSLA.O) has shuttered its office in San Mateo, California and laid off roughly 200 employees working on its Autopilot driver-assistant system there, one of the people told Reuters, in a move seen as accelerating cost-cutting.

Most of the laid-off people had been hourly workers, that person said.

Early this month, Tesla Chief Executive Elon Musk told top managers he had a “super bad feeling” about the economy and that the maker of electric cars needed to cut staff by about 10%.

Later, the billionaire said that the 10% cuts would apply only to salaried workers and that hourly staff numbers were still expected to grow.

“Tesla clearly is in a major cost-cutting mode,” said Raj Rajkumar, professor of electrical and computer engineering at Carnegie Mellon University. “This (staff reduction) likely indicates that 2Q 2022 has been pretty rough on the company due to the shutdown in Shanghai, raw material costs and supply chain problems.”