Why is Musk threatening to shift Tesla's headquarters from California
What's the story
Elon Musk, the billionaire CEO of Tesla, has threatened to shift his company's headquarters out of California. The warning from the tech mogul came in response to what he called a "power grab" by the Alameda County, which has been blocking the electric car-maker from re-opening its main factory due to the novel coronavirus pandemic. Here's what went down.
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No production at main Tesla plant since March
Located in the Fremont city of Alameda County, California, Tesla's US car plant has not been running since March 23, due to "shelter in place" restrictions enforced to prevent the spread of COVID-19. The order from the state had prompted the company to halt production and switch to "minimum operations [needed] to support vehicle and energy service operations and customers, and supercharging infrastructure."
Resuming production
Musk wanted to resume 'limited production' from Friday
A few days ago, the government of California eased some restrictions around the state, allowing businesses to resume activities. In response, Musk told Tesla staff that the company would resume limited production on Friday. But, as it turns out, several counties enforced their own restrictions for re-opening, with Alameda County requiring all non-essential businesses, including Tesla, to remain shut until the end of May.
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What Alameda County said in response
"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."
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Then, Musk lashed out at authorities, threatened to move
After being ordered to keep the Fremont plant closed, Musk lashed out at the local authorities, saying that the company will "move its HQ and future programs to Texas/Nevada immediately." "If we even retain Fremont manufacturing activity at all, it will be dependent on how Tesla is treated in the future," added the billionaire, noting that "Tesla is the last carmaker left in CA."
Lawsuit
Tesla also filed a lawsuit against Alameda County
Along with Musk's threat, Tesla has also filed a lawsuit against Alameda County to get its factory re-opened. In the case, the company alleged the extended restriction is a "power grab" by the county, especially considering that California's Governor has said manufacturers would be allowed to open. It said the county has defied the Governor's order and is going against federal and California Constitution.
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Alameda County acting contrary to common sense, said Musk
"Tesla is filing a lawsuit against Alameda County immediately. The unelected & ignorant 'Interim Health Officer' of Alameda is acting contrary to the Governor, the President, our Constitutional freedoms & just plain common sense!" Musk tweeted.
Twitter Post
Here are his tweets
Frankly, this is the final straw. Tesla will now move its HQ and future programs to Texas/Nevada immediately. If we even retain Fremont manufacturing activity at all, it will be dependen on how Tesla is treated in the future. Tesla is the last carmaker left in CA.
— Elon Musk (@elonmusk) May 9, 2020
Production
Tesla's production has been hit due to this lockdown
Though Tesla has been making deliveries, the continued lockdown has kept the company from manufacturing new cars at the Fremont facility - its only car plant in the US - and deeply affected its business. The factory employs more than 10,000 workers and makes about 415,000 vehicles every year. But now, the figure is expected to witness a decline.