Tesla factory is still open for business as Musk tells employees 'I will personally be at work'

Key Points
  • Tesla is keeping its Fremont, California car plant running during "shelter in place" orders initiated across the region to curb the covid-19 outbreak.
  • A pair of emails from CEO Elon Musk and head of North America HR for Tesla, Valerie Workman, told employees they could stay home if they wanted, but production, service and deliveries would be ongoing.
  • Tesla recently began deliveries of its new, crossover SUV, the Model Y, amid the covid-19 pandemic now impacting the U.S.
Tesla Chief Executive Office Elon Musk speaks at his company's factory in Fremont, California.
Noah Berger | Reuters

Tesla is keeping its Fremont, California car plant running during "shelter in place" orders initiated across counties in the San Francisco Bay Area to curb the COVID-19 coronavirus outbreak, including Alameda County where the factory is based. 

Employees at Tesla received emails about working during the pandemic and shelter-in-place orders late Monday, including one from CEO Elon Musk, and another from former compliance attorney at Tesla, Valerie Workman, now head of HR for North America. CNBC has seen copies of both emails. 

In the "everybody" e-mail about remaining despite the efforts to contain COVID-19, Musk wrote: 

"I'd like to be super clear that if you feel the slightest bit ill or even uncomfortable, please do not feel obligated to come to work. I will personally be at work, but that's just me. Totally OK if you want to stay home for any reason."

Musk assured employees in the email that, as far as he knew, no Tesla worker had been confirmed as infected with COVID-19 as of March 16. 

Bloomberg and the Los Angeles Times previously reported on the factory's status and the e-mails. 

Tesla recently began deliveries of its new, crossover SUV, the Model Y and is under pressure to get as many of these made and delivered to customers as possible before the end of the first quarter. Tesla has yet to revise or withdraw guidance for 2020 or the first quarter of the year, even though analysts expect the pandemic to cause a 20% drop in car sales in the US this year.  

Two employees and the family member of one Tesla employee told CNBC on Tuesday that workers there feared taking time off would impact their performance reviews and lead to their being fired later. And many cannot afford to go without income for the three weeks of shelter-in-place orders. 

One employee said that many Tesla colleagues had decided to take voluntary, unpaid leave and those who were left to work at the factory were now doing the jobs of two or three people at once. These people asked to remain unnamed because they were not authorized to speak with the press. 

Alameda County's public health department reported 27 confirmed COVID-19 cases as of March 17, 2020, but did not specify if any had occurred in Fremont or near Tesla's plant.

Tesla did not immediately respond to a request for comment.

Musk: Panic will cause more damage than virus

Echoing sentiments that he expressed on Twitter, and in e-mails sent to his SpaceX employees earlier, Musk soft-pedaled the seriousness of the novel coronavirus and wrote that "panic" was a bigger problem in his view than the infectious disease. He also erroneously compared COVID-19 to the common cold and the flu.

The common cold and the flu, like COVID-19, are especially dangerous for the elderly and people with compromised immune systems or other health issues. However, medical professionals and scientists with relevant experience caution that they are not comparable for many reasons: For instance, because COVID-19 is new to humans, there are no proven vaccines and no natural immunity to it, and early statistics suggest it has a significantly higher mortality rate than influenza with more severe symptoms in some populations.p

Since this disease is caused by a new virus, people do not have immunity to it, and a vaccine may be many months away. Doctors and scientists are working on estimating the mortality rate of COVID-19, but at present, it is thought to be higher than that of most strains of the flu.

Musk wrote to employees, nonetheless:

"My frank opinion remains that the harm from the coronavirus panic far exceeds that of the virus itself. If there is a massive redirection of medical resources out of proportion to the danger, it will result in less available care to those with critical medical needs, which does not serve the greater good." 

Without clarifying that he has no experience in epidemiology, public health, medicine or virology, Musk also erroneously called COVID-19 a form of the common cold: 

"My best guess, for what it's worth, based on the latest Center for Disease Control data, is that confirmed COVID-19 (this specific form of the common cold) cases will not exceed 0.1% of the US population. Moreover, I do not think when we look back on 2020, that the causes of death or serious injury will have changed much from 2017."

After downplaying COVID-19 risks, Musk concluded: "please do not feel obligated to come to work if this is causing you any concern. I'd rather you were at home and not stressed than at home and worried." 

HR chief: Tesla is essential

A follow-up email from North American HR leader Valerie Workman explained to Tesla employees, "During this time, the federal government has directed that all National Critical Infrastructure continue to operate during this pandemic," and that Tesla fell into this category. "People need access to transportation and energy, and we are essential to providing it." 

Workman told Tesla employees that if they work in "operations that directly support factory production, vehicle deliveries and service" they should continue to report to work. Others, like employees in finance, HR or administrative roles, should work from home until further notice, her e-mail instructed. 

She also reassured employees, per CDC guidelines: "To keep you safe, we will continue to follow social distancing guidelines (6 or more feet between employees)."

Employees told CNBC that Tesla has told them to wash their hands frequently and thoroughly, and provided hospital-grade, sanitizing wipes to people when they get on the company's shuttles to commute to work. They said "social distancing" could prove nearly impossible depending on circumstances and a person's role at Tesla -- often times, workers need to work closely together to build, repair or prepare cars for delivery.

CNBC reached out to the electric car maker, Fremont Mayor Lily Mei, the economic development offices of the city of Fremont and public health officials for Alameda County. None responded to requests for comment or further information.

A public affairs manager with the Fremont Police Department told CNBC that the decision to allow the factory to stay open was up to the county public health department, which issued the shelter in place order. 

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