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Musk Keeps Tesla Open in Midst of Lockdown, Downplays Risk

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These translations are done via Google Translate

By Dana Hull, Ed Ludlow and Josh Eidelson

(Bloomberg) Tesla Inc.’s factory and other California operations will remain open in the midst of a San Francisco Bay Area lockdown, with Elon Musk telling employees he will keep going in to work despite the spread of the coronavirus.

“I’d like to be super clear that if you feel the slightest bit ill or even uncomfortable, please do not feel obligated to come to work,” the chief executive officer wrote to staff in an email seen by Bloomberg News. “I will personally be at work, but that’s just me.”

Musk’s email didn’t specifically address whether Tesla will keep open its lone U.S. auto plant in Fremont, California. But his head of North American human resources sent a follow-up email saying that vehicle manufacturing and energy infrastructure are deemed crucial sectors, and that the factory will remain in operation despite Bay Area orders for people to stay home to limit the spread of Covid-19.

“Tesla and our supplier network will continue operations that directly support factory production, vehicle deliveries and service,” wrote Valerie Capers Workman, the company’s regional HR chief.

Tesla representatives didn’t respond to requests for comment. Musk’s email did not say if workers who want to stay home will be paid.

Aerial Views Of Silicon Valley Housing And Tech Campuses
The Tesla assembly plant in Fremont, California.

The spread of the coronavirus in the Bay Area prompted several counties to implement a shutdown this week, calling for people to shelter in place and shutter businesses unless they’re essential. Tesla is one of the largest employers in Alameda County, which reported 18 confirmed cases of Covid-19 as of Monday. The county’s public health department referred inquiries about Tesla to the company.

Musk told his millions of Twitter followers on March 6 that “the coronavirus panic is dumb.” The electric car-maker has said little publicly about how it’s handling the virus, in contrast with other automakers and Silicon Valley’s leading technology companies.


But Tesla has some experience to rely on: its Chinese factory near Shanghai was temporarily shuttered earlier this year and is now back online.

“My frank opinion remains that the harm from the coronavirus panic far exceeds that of the virus itself,” Musk wrote in the email on Monday. “If there is a massive redirection of medical resources out of proportion to the danger, it will result in less available care to those with critical medical needs, which does not serve the greater good.”

Tesla shares pared a decline of as much as 11% to trade down 2.5% as of 11:30 a.m. Tuesday in New York. The stock, which was up 119% for the year as of Feb. 19, erased its 2020 gains in early intraday trading.

Some employees probably will opt to stay home and assembly lines likely will be slowed, Chris McNally, an analyst at Evercore ISI, wrote in a report. He assumes Tesla will lose output of as much as 10,000 vehicles and burn through up to $1.2 billion in the first quarter, more than double his original bear-case scenario.

Tesla has not said how many cars it expects to produce and deliver in the first quarter. In January, the company said deliveries should “comfortably” exceed 500,000 units for the year. That number is now in question, with analysts at RBC Capital Markets saying Monday they expect the company to hand over 364,600 cars to customers, down slightly from its 2019 total.

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