Over the weekend, Tesla told some of its employees in California to get ready to return to work this week. But by Monday, the company reversed course and told those employees to stay at home. Now, it faces the possibility that its electric car factory will have to remain closed for longer than previously anticipated as public health officials say they will extend the stay-at-home orders in the San Francisco Bay Area through much of May.
Tesla told employees in early April that it hoped to bring them back on May 4th — a goal that was communicated in the same internal email where Tesla announced company-wide pay cuts and the placement of hundreds of workers on unpaid leave.
It’s not currently clear if the leaders of the six Bay Area counties will relax some parts of their orders, as a few states have started to do, and more details are expected later this week. The counties were the first in the country to issue a formal stay-at-home order when they announced it on March 16th. San Francisco mayor London Breed said she expects “some lower-risk activities to be allowed to resume,” but urged residents that the goal is to “build on the progress we’ve made.”
Tesla’s quick about-face caused some whiplash among its factory line workers, according to one who spoke with The Verge on the condition of anonymity because the furloughed employees weren’t expecting to be called back so soon. “Why would they furlough us for only a couple weeks? They wouldn’t, they expect this to [last] longer,” this person said last month. But when the company sent out the first emails this past weekend about coming back, this person said “I was getting frantic texts from people I know on the line who were being told they are starting back on Monday.”
Not going back to work, they said, is a relief for some of the workers — even the ones on unpaid leave. “We all have the same mindset, and it’s this: COVID-19 has not hit its peak in the area where we work or the areas where we live, so everyone is still at risk,” this person said. “Putting us back into an environment to which we could not social distance such as the production line or the shuttles would be a huge mistake and cause for our workplace to be hugely compromised as well as the towns we go back to.”
Tesla initially resisted the stay-at-home order and was one of the last automakers in the US to suspend operations. The company told local officials (and employees) that it had been deemed “national critical infrastructure” by the Department of Homeland Security and that the California factory should therefore remain open. This sparked a back-and-forth between the Tesla and the local sheriff’s office and health department about whether the company’s car manufacturing plant was an “essential business” or causing a “public health risk.”
The company eventually relented and announced it would close down the plant on March 23rd, though it continued to fight to keep its operations going right up until that date. A number of workers also had to report to the factory during the week following the shutdown to finish working on cars Tesla ultimately delivered as part of the company’s typical end-of-quarter push. (Tesla also halted most operations at its solar panel factory in New York and at the original Gigafactory in Nevada before announcing the salary cuts and furloughs.)
That push, combined with the launch of the Model Y and early success with the newly opened Gigafactory in China, helped Tesla beat expectations for its first quarter delivery and production figures despite the pandemic. What that means for the company’s bottom line will be revealed when Tesla announces its first quarter financial results on Wednesday.