Tesla Can Reopen California Plant With New Measures, County Says

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Tesla Inc. can begin preparing for a restart of its only U.S. car plant as soon as next week, a California county said, a boon for the automaker that had threatened to flaunt authorities’ orders to keep the factory shut.

Health officers for Alameda County said on Twitter late Tuesday that a reopening can happen if Tesla adopts extra recommendations to battle the coronavirus in its safety plans. Tesla had sent Alameda a new plan for meeting criteria to reopen on Monday.

The health department said it held “productive discussions” with Tesla and reviewed its safety and prevention plans, and will allow additional approved activities for local businesses including Tesla on May 18, provided data shows progress with containing the virus.

Chief Executive Officer Elon Musk had said Monday that Tesla would restart production at the plant in Fremont and flout county officials who had ordered the company to keep the factory closed. Earlier on Tuesday, he thanked President Donald Trump for endorsing his reopening of the factory.

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“California should let Tesla & @elonmusk open the plant, NOW,” Trump wrote in a tweet Tuesday. “It can be done Fast & Safely!”

The county and six other San Francisco Bay area municipalities had decided in late April to extend their restrictions on businesses through the end of May to battle the spread of the coronavirus. While California Governor Gavin Newsom announced last week he would let manufacturers in parts of the state reopen starting May 8, he also said local authorities could keep stricter measures in place.

Overnight, Musk sent an email to employees: “Just wanted to send you a note of appreciation for working hard to make Tesla successful. It is so cool seeing the factory come back to life and you are making it happen!!” he wrote in the message seen by Bloomberg News.

When asked on Twitter how Monday went at the factory, Musk replied Tuesday: “Great.” Tesla’s shares fell 0.2% in New York trading Tuesday. The stock has almost doubled this year.

Two workers who have returned to work at the plant said they were required to watch a safety-training video. One said the company handed out masks and had put up plexiglass stations in the break room. Another said plastic curtains hang from the ceiling as barriers to keep workers separated from one another, and that the carmaker is taking employees’ temperature using thermal scanners.

Musk’s emailed words of encouragement to staff followed tweets in which he claimed Tesla would move its headquarters and future programs to Nevada or Texas and may even cease manufacturing in California. To follow through on those threats, the CEO would have to uproot many of the roughly 20,000 employees the carmaker has in the San Francisco Bay area. About half of the company’s headcount is at the factory.

He wrote Saturday that Tesla would decide whether to keep manufacturing in Fremont based on how Tesla is treated in the future.

After prevailing in a defamation suit and emerging mostly unscathed from a court fight with the Securities and Exchange Commission last year, Musk is waging another legal battle. This time, he’s tangling with health officials over measures to contain a virus that he downplayed starting in January.

Musk has claimed Covid-19 isn’t all that viral a disease, called panic about it “dumb” and theorized fatality rates are overstated. He’s also promoted the antimalarial drugs President Donald Trump embraced that haven’t proved effective and wrongly predicted that new cases would be close to zero by the end of April.

What Bloomberg Opinion Says

Reopening a for-profit plant — and potentially endangering workers — for the sole purpose of making money isn’t a situation where morality should trump the law. And it should go without saying that it would create a truly terrible precedent if corporations could just ignore laws that they consider to be in violation of their corporate interests.

--Noah Feldman, columnist

Read the column here

Tesla’s standoff with California has come to represent the tense debate playing out in states and counties across America over how fast businesses should be allowed to reopen. The nation’s top infectious disease official, Anthony Fauci, warned against reopening the economy too soon during a Senate hearing Tuesday, saying that doing so risks new coronavirus outbreaks throughout the U.S.

Trump’s supportive Twitter post followed words of encouragement that Treasury Secretary Steve Mnuchin offered to Musk on Monday.

“He’s one of the biggest employers and manufacturers in California,” Mnuchin told CNBC. “California should prioritize doing whatever they need to do to solve those health issues so that he can open quickly and safely.”

Kimbal Musk, a Tesla director and Elon’s brother, shared a story on Mnuchin’s remarks with his more than 107,000 followers. “Only California and @GavinNewsom⁩ could make me a Trump fan,” he wrote.

California should do whatever's needed to help Tesla reopen car factory: Mnuchin

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