By Claudia Assis, MarketWatch
Tesla plans to keep its Fremont plant open under county review
Tesla Inc. has escalated a showdown with local health authorities and has reopened its car-making plant in Fremont, Calif., beyond minimal operations.
An Alameda County spokesperson said Tuesday that county health authorities have received and are reviewing Tesla's (TSLA) safety plan. "We will issue an update when we have more to share," the spokesperson said.
Tesla's plant is located in Alameda County, one of the six San Francisco Bay Area counties under a regional shelter-in-place order set to expire May 31. The region is moving at a slower pace to reopen nonessential businesses, and health authorities have said their order trumps the state's.
The authorities confirmed Monday Tesla had reopened the plant beyond basic operations, and that they had notified Tesla it could only maintain minimal work until an approved plan is in place.
It is unclear whether Tesla would suffer any consequences for reopening without a plan in place.
Chief Executive Elon Musk started the latest volley of shutdown complaints late Monday, when he vowed to reopen the plant, Tesla's sole U.S. car-making facility, in defiance of the regional shutdown order to curb the spread of the coronavirus.
A spokesperson with the Alameda County Sheriff's Office had declined to comment on Monday, and neither Tesla nor the Fremont Police Department immediately responded to requests for comment.
Earlier Tuesday, President Donald Trump tweeted his support of Musk, () saying the Fremont plant should open "NOW."
Musk has intensified his criticism of the regional order in the past few days.
He tweeted Saturday that he will move Tesla's factory and headquarters out of California (), and hours later Tesla made good on his threat to sue Alameda County, calling the local shutdown order a "power grab" and seeking an injunction to reopen the plant ( ).
Musk and Tesla are "putting major pressure on Alameda County" to reopen the factory and "Musk is not just talking the talk but walking the walk," Wedbush analyst Dan Ives said in a note Monday.
Moving away from the California car-making factory would take at least 12 months to 18 months "and could add risk to the manufacturing and logistics process in the meantime," Ives said.
In a blog post () posted Saturday titled "Getting Back to Work," Tesla said it was preparing to resume operations with certain modifications in place and saying it had shared the plan with local authorities. Fremont and Tesla's battery factory in New York state have been closed since late March.
The Fremont factory employs more than 10,000 people. The plant was a General Motors Co. (GM) facility for 20 years until 1982, and home to a GM and Toyota Motor Co. (7203.TO) partnership until 2009.
Tesla bought the facility in 2010 and "extensively remodeled it" before the first Model S sedan rolled off the line in June 2012, Tesla says on its website.
Musk has railed against shutdown orders on Twitter and, more unusually, during a conference call with analysts to discuss Tesla's first-quarter results last month.
At the time, Musk called the orders "fascist." ()
The local health authorities on Friday had foiled Tesla's plans to start reopening the factory, saying that their own shutdown orders prevailed even though some nonessential businesses are reopening elsewhere in the state.
Tesla shares have gained 245% in the past 12 months, compared with gains around 1% for the S&P 500 index .
-Claudia Assis; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
May 12, 2020 14:43 ET (18:43 GMT)
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