Winnietam/Dreamstime.com
Tesla, Fremont, California © Winnietam Dreamstime

Tesla Resumes Feud with Local Health Officials; Musk Says Company Will Sue, Move HQ

May 11, 2020
Alameda county officials butted heads with Tesla over reopening a Fremont plant on Friday, May 9.

Update: Tesla has resumed operations at its Fremont, California plant in open defiance of local official's orders. CEO Musk has said he will be on the assembly line if any arrests are made. This story is developing.

Firebrand futurist and Tesla Motors CEO Elon Musk has sued local officials and vowed to move his company’s headquarters out of California to Texas or Nevada after Alameda County health officials said the company’s Fremont, California plant would have to remain closed another week.

In an email to employees, Tesla Motors said last week that they would reopen production at the plant, which manufactures most Tesla vehicles, on May 8. That appears to have been based on California Governor Gavin Newsom’s order relaxing COVID-19-related restrictions on manufacturing and retail businesses. But local authorities in Alameda County say they have not lifted their own restrictions, and that Tesla cannot yet resume manufacturing in Fremont until at least May 18.

According to Elon Musk, this was “the last straw.” On May 9, Musk inveighed against the health order and the office that issued it in a series of tweets, saying his company would sue the health department and move its headquarters to Texas or Nevada “immediately,” with future Fremont manufacturing activity reliant on “how Tesla is treated in the future.” Fremont is one of Tesla’s two existing vehicle manufacturing facilities: the other is in Shanghai.

In a statement released May 9, a spokesperson for Alameda county said that the county’s health care services agency and public health department have been working closely with Tesla on a “collaborative, good faith effort” to reopen the factory safely. Scott Haggerty, the county supervisor for Alameda County’s district, said in comments to the New York Times that local officials and Tesla executives were on board with a May 18 reopening, consistent with the national reopening schedules of General Motors, Ford Motor, and Fiat-Chrysler, but that Musk preferred a faster restart.

Tesla Motors’ lawsuit against Alameda county alleges that the county’s orders lack the authority to impose criminal penalties or supersede state-level orders. The lawsuit, filed in federal court of the southern district of California, also alleges the county issued an FAQ “that expressly describes essential businesses in terms that encompass Tesla’s Fremont Facility.” It cites an FAQ issued by the County that says “Businesses may also operate to manufacture distributed energy resource components, like solar panels.” The FAQ on the county website, which notes it was updated May 9, no longer includes this line.

Alameda county is one of six San Francisco-area counties that originally imposed quarantine orders on March 16. Musk tussled with county officials then, too, arguing that Tesla Motors was an essential business and could remain open before acquiescing to orders to close March 19.

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