Tesla to Reduce Gigafactory Staff by 75 Percent
With Panasonic having already made plans to ramp down production at the Nevada battery facility it shares with Tesla, followed by a 14-day closure to curtail the spread of the new coronavirus, its business partner has decided to follow suit. Tesla now plans on reducing on-site staff at Gigafactory 1 by 75 percent, according to the local county manager Austin Osborne.
“Tesla has informed us that the Gigafactory in Storey County is reducing on-site staff by roughly 75 [percent] in the coming days,” he explained via the county’s website on Thursday. “Our companies at [Tahoe Reno Industrial Center] TRIC are taking the COVID-19 matter seriously, and regularly report to us the measures they are taking to adhere to the established guidelines while maintaining essential operations. Checking employee temperatures, creating central access, allowing remote work, maintaining workstation distance, and others are occurring.”
While Tesla CEO Elon Musk has been adamant that it’s important to get some factories back up and running as soon as possible to supply medical ventilators ( an interesting product shift for an interesting period), he’s walked back some of his earlier claims that COVID-19 was overblown.
After becoming one of the few automotive holdouts in the United States still attempting to maintain production, the manufacturer has since suspended assembly at its vehicle factory in Fremont, CA. It also has a couple of known coronavirus cases within its staff, though nobody has confirmed where those workers hail from — just that they are now quarantined at home.
The Nevada Gigafactory produces Model 3 electric motors, battery packs, and various energy storage solutions sold by Tesla (e.g. Powerwall, Powerpack). Meanwhile, Panasonic handles the physical cells used in the automaker’s battery packs. Since there won’t be any Panasonic employees on hand to put those together next week, Tesla is left with little recourse, as this creates an impassable gap in its immediate battery supply chain.
[Image: Welcomia/Shutterstock]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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I am curious to see how Tesla will do during the current business disruption. They have always been dependent on good cash flow, and subsidies in the form of pollution credits from other manufacturers, I would imagine those credit payments will fall. I also wonder about their ability to continue to raise money in the market. Usually they do that by promising the introduction of a new model- most recently the Cyber Truck. However, I can’t see that gambit of selling tomorrow’s promises being very effective in these circumstances. I would assume that Tesla will be eligible for some government help on the same lines as Ford, GM, and FCA receive, but would that suffice?
I hope that once this passes that America wakes up to the realization that we have become totally dependent on China and that we take back our independence and ability to provide for our own country. But the realist in me knows that once we are able, we will run right back out and begin massive consumption of cheap goods from a country that is neither friend or ally. We could be leading the effort to solve this, much like we have done in the past, but I fear our desire and ambition to take the reigns had long passed...