Tesla Hires Former Audi Exec to Oversee Production as Report Slams Imported Labor at Fremont Factory

Steph Willems
by Steph Willems

In a bid to get the Model 3 out the door on time, ideally without the snafus that plagued the Model X, Tesla Motors has hired a longtime Audi executive to serve as vice-president of vehicle production.

The hiring of 22-year Audi veteran Peter Hochholdinger, first reported by Reuters, comes as Tesla ramps up its manufacturing capacity to handle the 400,000 reservations placed on its upcoming $35,000 sedan.

Amid the company’s all-out dash to bring its Fremont, California factory’s production capacity to 500,000 vehicles per year by 2018, a damning report just released by the Bay Area News Group sheds light on the low-cost foreign labor helping to build that capability.

The report details a group of Slovenian and Croatian laborers brought into the U.S. on business visas to help build the Fremont factory’s new paint shop last year.

The workers, one of whom sustained a serious injury in a fall at the Tesla paint shop, were among many eastern European men hired by overseas contractors to work in the U.S., despite having few qualifications. The group at the Tesla plant worked up to 10 hours a day, six days a week, and received compensation to the tune of $5 an hour.

Neither Tesla nor the contractor have accepted responsibility for the practice, which critics say violates labor and visa laws. Local trades groups aren’t happy about the jobs going to the imported workers.

Because the hiring and compensation occurred through a private contractor, the automaker absolved itself of blame for the working conditions, telling the media group, “Tesla expects all its contractors and their subs … to comply with all applicable pay laws.”

While the foreign labor issue is one that impacts many companies, not just Tesla, the automaker’s focus remains on bringing the Model 3 to market in big numbers by late 2017.

After the botched roll-out of the Model X SUV due to supplier issues, Tesla purged Greg Reichow, the company’s former vice-president of production, and Josh Ensign, vice-president of manufacturing, from its ranks.

Hochholdinger’s job is to boost production of existing models while creating a cost-conscious manufacturing program for the Model 3.

Putting all of the pieces together in a timely fashion is key. Founder and CEO Elon Musk already announced on Twitter that tardy buyers might have to wait until 2019 to see delivery of their Model 3.

[Image: Tesla Motors]

Steph Willems
Steph Willems

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  • Mcs Mcs on May 16, 2016

    Looking through Eisenmann's press releases, it looks like they've been hired by a number of auto companies. I see Volvo, Mercedes, VW, BMW, and FCA. Probably others. So, if you're gonna bitch about Tesla hiring this company, it's probably safe to say the same thing has happened at these other auto manufacturers as well.

    • Orenwolf Orenwolf on May 17, 2016

      Like the inflated "slams" headline, it's more fun to pretend this is a tesla-only problem, not that this is a supplier used by *five* other major car companies, because of course none of *them* would support this sort of labour. Suppliers and contractors lie. When you race everyone to the bottom by searching for the lowest bidder (in order to offer the lowest prices possible while keeping your margins high for the shareholders), corners are inevitably cut to make those rates. People think the fair trade, etc. movements are just trehuggers. Many are. But many people also realize that if you want a product or service that's ethically produced or carried out, a *big* help in that regard is to remove the price pressure. The problem, of course, is that greed still gets in the way - companies can charge more to be "made in USA", for example, and still treat their workers as cattle. One hopes it's more difficult to do so. But as this article shows, there are loopholes even for US companies providing services such as these, and many major companies are blindly accepting their work, because they *appear* to be ticking the correct legal boxes in the process.

  • Art Vandelay Art Vandelay on May 17, 2016

    So why are we importing auto workers? These visa programs exist for trades which there isn't a pool of skilled workers in the country to hire from. Last time I checked we had a few unemployed auto workers. Of course they get paid more than minimum wage. So it isn't a case of "there is nobody to do the job", but rather a case of "We don't want to pay what the US market has decided an auto worker is worth". The pendulem swings back and forth and these sort of shenanigans are what leads to union shops. Also, substitute "Tesla" with "Trump" in this article and me thinks many of the voices that are OK with this would be crying foul.

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