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Tesla Sues California County Over Factory Closure, Starts Production Without Approval

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  • Tesla is suing Alameda County in an effort to resume operation at its Fremont factory, claiming that it is considered “national critical infrastructure” and should be able to restart under the governor’s guidance for reopening some businesses with safety modifications.  
  • Musk even threatened to move Tesla’s headquarters out of California, noting that it is the last major carmaker in the state as well as one of it’s largest manufacturing employers.
  • Though a move would be costly and difficult, some believe the tensions could further push Musk to look elsewhere for the manufacturing of other projects.  
  • Fremont’s Mayor urged the county to work with businesses trying to reopen after expressing concern about the potential implications for the regional economy. The county says it is communicating with Tesla and hopes to reach an agreement soon, but Tesla has already started ordering employees back to work.  

Musk Threatens To Move Tesla HQ 

Tesla has filed a lawsuit against Alameda County in Califonia, arguing that its Fremont factory should be allowed to operate during the coronavirus pandemic under the governor’s new guidance for reopening some businesses. 

The factory has been shut since March 23, after the county called for its closure as part of social distancing measures and stay-at-home orders, but the company has been pushing to resume production.

Then on Thursday, Gov. Gavin Newsom announced that he is allowing for sectors like retail, manufacturing, and logistics to reopen with “modifications that reduce risk,” however, he stressed that local officials still have the authority to speed up or slow down reopening at the county level. 

On Saturday, Tesla CEO Elon Musk expressed frustration about local resistance Tesla has faced.

“Tesla is filing a lawsuit against Alameda County immediately,” Musk announced in a tweet. “The unelected & ignorant “Interim Health Officer” of Alameda is acting contrary to the Governor, the President, our Constitutional freedoms & just plain common sense!”

Musk even threatened to move Tesla’s headquarters to Texas or Nevada as a result of the shutdown.

Musk’s frustration seems to have been building because late last month, he ranted about stay-home orders in the company’s April 29 first-quarter earnings call. In it, he called the restrictions fascist and a violation of people’s constitutional rights. 

Tesla Releases Blogpost Explaining Lawsuit and Restart Plans

The same day Musk tweeted his threat, Tesla released a blog post about how it will get it’s employees back to work safely. In the post, the company noted that it is the last major carmaker in the state as well as one of it’s largest manufacturing employers with more than 10,000 workers at its Fremont factory and 20,000 statewide. 

Tesla again argued that its Fremont plant should be allowed to reopen under Newsom’s recent guidelines, but it also said it should have always had permission to continue production because the state and federal government classifies vehicle manufacturing as “national critical infrastructure.”

It company even noted that, “Alameda county, where our factory resides, and Santa Clara County next door, have stated in their return to work order FAQs that the manufacturing of distributed energy resources (which is defined in state law to include electric vehicles, solar and battery storage) is permitted to resume.”

Along with these points, the company explained that it has worked hard on a “robust” restart plan, saying, “It was modeled after the comprehensive return to work plan we established at our Shanghai Gigafactory, which has seen smooth and healthy operations for the last three months.”

“Contrary to the Governor’s recent guidance and support from the City of Fremont, Alameda County is insisting we should not resume operations,” Tesla’s leadership added in the post. 

“This is not for lack of trying or transparency since we have met with and collaborated on our restart plans with the Alameda County Health Care Services Agency.” 

The company claims that the County Public Health Officer making decisions about reopening has not returned its calls and emails listing out detailed restart plans, factory layouts, and more. 

“We will continue to put people back to work in a safe and responsible manner. However, the County’s position left us no choice but to take legal action to ensure that Tesla and its employees can get back to work,” it said before noting that it is asking the court to render the shutdown order invalid.

Alameda County Responds  

Fremont Mayor Lili Mei responded to Tesla Saturday afternoon saying, “As the local shelter-in-place order continues without provisions for major manufacturing activity, such as Tesla, to resume, I am growing concerned about the potential implications for our regional economy.”

“We know many essential businesses have proven they can successfully operate using strict safety and social distancing practices. I strongly believe these same practices could be possible for other manufacturing businesses, especially those that are so critical to our employment base.”

She then encouraged the county to work with local businesses to reopen with acceptable guidelines.

Shortly after, Alameda County’s Health Department released a statement saying it has been working with Tesla to develop a safety plan allowing the Fremont plant to reopen while protecting workers. 

“This has been a collaborative, good faith effort to develop and implement a safety plan that allows for reopening while protecting the health and well-being of the thousands of employees who travel to and from work at Tesla’s factory,” the county said.

“We look forward to coming to an agreement on an appropriate safety plan very soon.″

However, it stressed that “It is our collective responsibility to move through the phases of reopening and loosening the restrictions of the shelter-in-place order in the safest way possible, guided by data and science.”

Scott Haggerty, supervisor for the Fremont district of Alameda County, told the New York Times on Saturday, “We were working on a lot of policies and procedures to help operate that plant and quite frankly, I think Tesla did a pretty good job, and that’s why I had it to the point where on May 18, Tesla would have opened.”

“I know Elon knew that. But he wanted it this week,” he added.

Criticism and Support 

It seems like Tesla could be getting the green light it was hoping for, though it’s unclear when. However, Tesla apparently isn’t waiting for approval. According to a report from The Verge, some employees were called back to work at the facility over the weekend and others are scheduled to report to work later this week.

Then on Monday, Musk acknowledged that he was restarting against orders.

Still, some lawmakers don’t seem to happy about Tesla’s attempts to reopen. California State Assemblywoman Lorena Gonzalez (D-San Diego) added fuel to the flames after Musk’s threat when she tweeted, “F—- Elon Musk.”

“California has highly subsidized a company that has always disregarded worker safety & well-being, has engaged in union busting & bullies public servants,” wrote Gonzalez in a follow-up tweet on Sunday. “I probably could’ve expressed my frustration in a less aggressive way. Of course, no one would’ve cared if I tweeted that.”

On the other hand, Tesla has seen some support from those like U.S. Treasury Secretary Steven Mnuchin. Mnuchin backed Musk on Monday, telling CNBC that California should help Tesla reopen its plant.

“I agree with Elon Musk. He’s one of the biggest employers and manufacturers in California, and California should prioritize doing whatever they need to do to solve those health issues so that he can open quickly and safely,” Mnuchin said on “Squawk on the Street.”

“They’re going to find that if he’s threatened he’s going to move his production to a different state,” Mnuchin added.

As some have pointed out, moving Tesla’s headquarters, especially during the pandemic, would be a difficult and costly move for the company.

“Moving away from Fremont would take at least 12 to 18 months and could add risk to the manufacturing and logistics process in the meantime,” Wedbush Securities analyst Daniel Ives wrote in a note to investors.

However, Musk has previously hinted that he’s eyeing other places to build his Cybertrucks and expand production of his Model Y crossover, so some believe Musk’s frustrations with the state and county could further push him to launch more operations elsewhere.

The lawsuits come as competing automakers are gradually starting to reopen factories in the U.S. Toyota will restart production on Monday, while General Motors, Ford, and Fiat Chrysler all plan to restart their plants gradually on May 18. 

See what others are saying: (Huffington Post) (Axios) (CNBC) 

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Target Joins Walmart in Offering Free College Tuition To Attract and Retain Workers

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The decision makes Target the latest major company to dangle such incentives before employees, joining the likes of Walmart, Chipotle, and Starbucks.


Target Launches Debt-Free Education Asssitance Program

Target announced new employee perks on Wednesday that it likely hopes will help attract and retain workers. 

Starting this fall, Target will cover the cost of tuition, fees, and textbooks for both part-time and full-time workers who pursue degrees or certificates at more than 40 participating institutions.

Employees will have at least 250 different business-aligned programs to choose from, including Business, Computer Science, Design, and more.

Target will also fund advanced degrees, paying up to $10,000 each year for master’s programs at those schools, and it’s offering up to 5,250 for those pursuing non-master’s degrees or business-aligned programs at one of the select schools.

The company said it plans to invest a total of $200 million in the education program over the next four years, and employees in the U.S. will qualify as soon as their first day.

“Target employs team members at every life stage and helps our team learn, develop and build their skills, whether they’re with us for a year or a career. A significant number of our hourly team members build their careers at Target, and we know many would like to pursue additional education opportunities. We don’t want the cost to be a barrier for anyone, and that’s where Target can step in to make education accessible for everyone,” said Melissa Kremer, Target’s Chief Human Resources Officer.

Companies With Similar Perks

Places like Chipotle and Starbucks have already had similar education programs in place, but more companies have been introducing or expanding on similar policies as businesses across the country struggle to find and retain workers amid the coronavirus pandemic.

Just last week, Walmart announced that it will cover the full cost of college tuition and books for itsemployees, after previously requiring them to pay $1 a day for the assistance. Those workers can now select from around 10 academic partners.

While many have applauded these actions from big corporations, others have noted that it makes it tougher for smaller businesses to compete since they don’t have the same resources at their disposal.

There is some concern about how this could change the business landscape in the future as a handful of large companies dominate in their own sectors and siphon a lot of the talent, forcing smaller competitors to close. Still, others argue that this was already happening. At least now, the big players are investing and support their workforce while doing it.

See what others are saying: (CNBC) (The Hill) (Forbes)

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Tencent Stock Plummet as Company Weighs Video Games Ban for Kids in China

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The world’s largest game developer appears fearful that the Chinese government will launch another crackdown on gaming similar to one it launched in 2019 when it limited game time for minors.


No More Video Games

Tencent Holdings, Ltd. — China’s most valuable corporation and the world’s largest gaming company — announced Tuesday that it would consider completely banning games for those under 12-years-old in China.

Tencent also announced that it will now limit playtime for Chinese minors to just 1 hour during weekdays and no more than 2 hours during weekends and holidays. Under a Chinese law set up in 2019, game developers are required to limit minors to just 1 hour and 30 minutes of playtime during weekdays and 3 hours during weekends and holidays.

Additionally, the company explained that it will move forward with plans to enact systems that bar those under 12 from engaging in microtransactions, starting with the largest mobile game, “Honor of Kings” (王者荣耀). It’s possible the ban will extend to some of Tencent’s other holdings, such as “League of Legends” (Riot Games) and “Path of Exile” (Grinding Gear Games), although these changes will likely only affect Chinese users.

Tencent’s decision comes just a day after the Economic Information Daily, a subsidiary of state media giant Xinhua News, said in a now-deleted article that video games were “spiritual opium” and that no industry should continue in a manner that will “destroy a generation.”

Likening video games to opium holds cultural significance in China, which has long disliked narcotics and is sensitive to comparisons to the drug. Using such language, especially by state media, is often seen as a sign that the government is ready to crack down on the industry.

Crackdown Fears

Those fears largely played out over a 24-hour period as shares for Tencent and NetEase, another large game developer in China, plummeted. Tencent’s shares dropped by 11% on the Hong Kong Stock Exchange, although it eventually settled at just a 6% loss by the end of Tuesday.

It wasn’t just Chinese gaming companies that were worried. The announcement sent ripples across the entire industry as Nintendo, Capcom, and Nexon shares all were heavily affected as well. One of the reasons that such an article can cast widespread concern is that China has increasingly become the largest market in the $180 billion video game industry, making it larger than the global movie industry and North American professional sports, combined.

Coupled with the recent fall of ActivisionBlizzard’s stock over the last two weeks due to its sexual assault lawsuit and other industry shakeups, over a trillion dollars of market value was wiped out at one point on Tuesday.

See what others are saying: (Associated Press) (Time) (Fox Business)

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Google Is Banning “Sugar Dating” Apps as Part of New Sexual Content Restrictions

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The change essentially targets apps like Elite Millionaire Singles, SeekingArrangements, Spoil, and tons of other sugar dating platforms.


Sugar Dating Crackdown

Google has announced a series of policy changes to its Android Play Store that include a ban on sugar dating apps starting September 1.

The company’s Play Store policies already prohibit apps that promote “services that may be interpreted as providing sexual acts in exchange for compensation.”

Now, it has updated its wording to specifically include “compensated dating or sexual arrangements where one participant is expected or implied to provide money, gifts or financial support to another participant (‘sugar dating’).”

The change essentially targets apps like Elite Millionaire Singles, SeekingArrangements, Spoil, and tons of other sugar dating platforms currently available for download.

Search results for “Sugar Daddy” on Google’s Play Store

What Prompted the Change?

The company didn’t explain why it’s going after sugar dating apps, but some reports have noted that the move comes amid crackdowns of online sex work following the introduction of the FOSTA-SESTA legislation in 2018, which was meant to curb sex trafficking.

That’s because FOSTA-SESTA created an exception to Section 230 that means website publishers can be held liable if third parties are found to be promoting prostitution, including consensual sex work, on their platforms.

It’s worth noting that just because the apps will no longer be available on the Play Store doesn’t mean the sugar dating platforms themselves are going anywhere. Sugar daters will still be able to access them through their web browsers, or they can just sideload their apps from other places.

Still, the change is likely going to make the use of these sites a little less convenient.

See what others are saying: (The Verge)(Engadget)(Tech Times)

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