Elon Musk’s contentious relationship with Alameda County officials reached a tipping point on Saturday, when the Tesla CEO announced plans to relocate the company’s headquarters and “future programs” away from Fremont, CA, to facilities in Texas and Nevada “immediately.” This came as a response to the continued forced closure of Tesla’s Fremont manufacturing plant as per COVID-19 stay-in-place regulations.
“Frankly, this is the final straw,” Musk tweeted.
Musk also announced his intent to file a lawsuit against Alameda County officials “immediately,” adding, “The unelected & ignorant ‘Interim Health Officer’ of Alameda is acting contrary to the Governor, the President, our Constitutional freedoms & just plain common sense!” Musk also encouraged Tesla shareholders to file a class-action suit against the county.
The latest back-and-forth between Tesla and Alameda County officials began on Thursday, when a memo sent to Tesla employees indicated that its Fremont plant would reopen “at 30% our normal headcount per shift,” as reported by TechCrunch. Alameda officials responded on Friday with a firm reminder that the county’s stay-in-place order would remain in effect for Tesla, and all other “non-essential” operations in the county, until May 31, with the exception of “basic” operations.
While California governor Gavin Newsom announced a statewide lift of restrictions on Thursday for manufacturers and other businesses, the county ordinance remains in place, which led to Alameda giving the following statement to members of the press:
We have informed Tesla of all of the conditions that must exist for phasing in the safe reopening of various sectors of the economy and the community. Tesla has been informed that they do not meet those criteria and must not reopen. We welcome Tesla’s proactive work on a reopening plan so that once they fit the criteria to reopen, they can do so in a way that protects their employees and the community at large.
Musk did not clarify whether the Fremont plan would continue to operate as a Tesla manufacturer once any Alameda shutdown order lifts, saying on Twitter, “it will be dependent on how Tesla is treated in the future. Tesla is the last carmaker left in CA.”
Still “not an essential business”
This is the latest round in a public back-and-forth between Musk and Alameda County, which kicked off in mid-March when Musk insisted upon defying Alameda County’s earliest stay-in-place orders. This prompted a Twitter reply from the Alameda County sheriff’s office: “Tesla is not an essential business as defined in the Alameda County Health Order. Tesla can maintain minimum basic operations per the Alameda County Health Order.” One day later, Musk said Tesla’s Fremont factory would obey the order… within seven days.
Tesla announced a sweeping cost-cutting plan in early April, complete with staff-wide pay cuts and furloughs, which was followed weeks later by an unexpected announcement of profit. In an April 29 call to investors, Tesla confirmed that it had successfully turned a profit for three quarters in a row and was sitting on cash reserves of $8.1 billion.
As of press time, Musk did not clarify exactly where or how Tesla’s operations would shift as it relates to the two named states. Tesla maintains a “Gigafactory” for battery production near Sparks, NV, while Musk’s SpaceX has operated in Texas sites such as Boca Chica Beach.