Tesla Reverses Gear On Reopening Fremont Facility As Stay-At-Home Orders Likely To Be Extended

Tesla Inc. TSLA has canceled plans to restart production at its Fremont, California plant this week after asking workers last Friday to return to work.

What Happened

In messages sent out Monday, which were also posted on internal message boards, the automaker announced, “Per the direction of the executive leadership team, we will not be returning to work Wednesday, April 29. Please disregard all communication and directives on returning to work this week,” reported CNBC.

Meanwhile, Alameda County, where the Fremont facility is located, is expected to issue guidelines on the extension of the stay-at-home orders jointly with six other counties, including San Francisco and the city of Berkley. The restrictions are expected to be extended through May.

Why It Matters

Tesla shares slipped more than 2% in the after-hours session after gaining 10% in regular trading on Monday after news regarding cancelation of production came out.

According to the joint statement released by the health officers of the seven counties, easing of specific restrictions will likely apply to only a “small number of lower-risk activities.”

Tesla’s operations at Fremont were deemed “non-essential” by local authorities. Furloughed Tesla workers who were asked to return to work, had expressed concerns over COVID-19 related issues at the Fremont facility.

Fremont is the sole car manufacturing plant of Tesla in the United States and had suspended full production from March 23.

As of Monday, Alameda County reported 1,451 cases of COVID-19 with 51 fatalities.