Elon Musk threatens to pull Tesla operations out of California and into Texas or Nevada

Tesla CEO Elon Musk said Saturday the company will file a lawsuit against Alameda County and threatened to move its headquarters and future programs to Texas or Nevada immediately, escalating a fight between the company and health officials over whether its factory in Fremont can reopen.

Tesla had planned to bring back about 30% of its factory workers Friday as part of its reopening plan, defying Alameda County's stay-at-home order.

Updated: Tesla has since filed a lawsuit against Alameda County seeking to nullify the county's orders and allow the automaker to resume operations.

Alameda County Health Care Services Agency and the Public Health Department issued a statement in response stating that the agencies "have been communicating directly and working closely with the Tesla team on the ground in Fremont." The agencies called it 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 officials said Tesla has been responsive to their guidance and recommendations and look forward to coming to an agreement.

California Gov. Gavin Newsom issued new guidance Thursday that allowed manufacturers to resume operations. The guidance won praise from Musk, who later sent an internal email to employees about plans to reopen based on the governor's revised order. However, the governor's guidance included a warning that local governments could keep more restrictive rules in place. Alameda County, along with several other Bay Area counties and cities, last week extended the stay-at-home orders through the end of May. The orders were revised and did ease some of the restrictions. However, it did not lift the order for manufacturing.

On Friday, the Alameda County Health Department said Tesla had not been given "the green light" to reopen and said if the company did, it would be out of compliance with the order.

In the tweet, Musk said Tesla is filing a lawsuit against Alameda County immediately. In a later tweet, he also encouraged shareholders to file a lawsuit against the county.

"The unelected & ignorant "Interim Health Officer" of Alameda is acting contrary to the Governor, the President and our Constitutional freedoms & just plain common sense!," the tweet said. He followed up with another tweet claiming that Tesla will now move its HQ and future programs to Texas or Nevada immediately.

"If we even retain Fremont manufacturing activity at all, it will be dependent on how Tesla is treated in the future. Tesla is the last carmaker left in CA," Musk wrote.



City of Fremont Mayor Lily Mei said Saturday after Musk's tweets she is growing concerned about the potential implications for the regional economy if there are not provisions for major manufacturing companies such as Tesla to resume operations under the shelter-in-place order.

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

Mei encouraged Alameda County to work with local businesses to come up with acceptable guidelines for re-opening our local economy. "As we have done for over a decade, the City is prepared to support Tesla as soon as they are able to resume automobile manufacturing operations and are committed to a thoughtful, balanced approach to this effort that remains safe for our Fremont community," Mei said.

Palo Alto Mayor Adrian Fine also expressed support for Tesla in a tweet that said he stands ready to help. "I truly appreciate having a cutting edge company based here, employing people, paying taxes, and helping to solve the climate crisis," Fine tweeted from his personal account.

Tesla has operations in Nevada; it doesn't in Texas, although Musk's other company SpaceX has operations there. The company's massive battery factory - known as Gigafactory 1 — is located in Sparks, Nevada. Tesla is seeking out a new location to build a new U.S. gigafactory that will produce the Cybertruck and Model Y crossover. Some have speculated that Texas is a top pick.

Sources have told TechCrunch that Tesla is in talks with Nashville officials to locate a factory there that will produce the Cybertruck and Model Y crossover.

“Scouting locations for Cybertruck Gigafactory. Will be central USA,” Musk tweeted in March. He added that the factory would be used to produce Model Y crossovers for the East Coast market. The first Model Y vehicles are being produced at its plant in Fremont.