Tesla is not cleared to reopen US factory, local officials say

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KEY POINTS
  • Local authorities say Tesla is not cleared to reopen its U.S. car plant in Fremont, California.
  • CEO Elon Musk and HR boss Valerie Workman had asked employees to return to work to resume production on Friday afternoon.
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Kuka robots work on Tesla Model X in the Tesla factory in Fremont, California.
Kuka robots work on Tesla Model X in the Tesla factory in Fremont, California.

Tesla CEO Elon Musk wanted to restart production at the company’s U.S. car plant in Fremont, California, on Friday afternoon after weeks of “minimum basic operations” required after Covid-19 health orders. But local authorities now say the company is not cleared to reopen.

Erica Pan, interim health officer for the Alameda County Public Health Department, said on an online town hall meeting on Friday that even though California had relaxed Covid-19 restrictions at the state level, that legally, “If there are local orders, whichever is stricter prevails.”

She added that currently, Alameda County — where the Fremont car factory is based — is “still a little bit stricter,” than the state in its approach to protecting public health amid an outbreak of the novel coronavirus.

“We have not given the green light. We have been working with them looking at some of their safety plans. But no, we have not said that it is appropriate to move forward.” Pan said when asked about Tesla specifically.

Tesla resisted and debated local authorities when they first implemented Covid-19 restrictions in March. The company wound down to minimum basic operations there on March 24. Tesla called some workers back to production shifts there in later April, too, but rescinded those plans facing health orders again.

Just after that, Musk slammed the health orders, calling them “fascist,” in a swear-laden earnings call.

Alameda County has a shelter-in-place order effective through May 31, according to the county public health department website. Pan said she expected to know more in another week or two about whether the county could allow manufacturers, including Tesla, to reopen their factories.

A public information officer for Alameda County Public Health Department offered more details in a statement:

“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. All businesses within the County must comply with the May 4th Health Officer Order and if a business does not meet the limited criteria stated in that Order to reopen, then they are out of compliance.

“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.”

A spokesperson for the Fremont Police Department said it had not been in touch with Tesla regarding any possible violation.

“Businesses are not required to contact the police department regarding specific plans or business operations, so we have not been in contact with Tesla.” She added, “Our legal counsel is also reaching out to gain further clarity around some of the language in the most recent FAQ document,” from the county.

CNBC reached out to Tesla, and the company’s human resources leader, Valerie Workman, to ask how plans for U.S. employees and vehicle production may now change. They were not immediately available to comment.

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