California considers whether Tesla factory can operate in coronavirus shutdown

(Reuters) – Local California officials on Tuesday were evaluating if and how Tesla Inc (TSLA.O) will be allowed to continue operating its main U.S. vehicle factory as the San Francisco Bay Area begins a three-week lockdown to rein in the spread of coronavirus.

A spokesman for California’s Alameda County, where Tesla’s Fremont factory is located, said the county was consulting its lawyers and health officials to evaluate the situation and provide an answer by the end of the day.

“Part of Tesla’s operations might fall under an exemption in the (county’s) order, but making cars and pumping them out at the end of the assembly line is another question,” the spokesman said.

Tesla told employees in an email that the company and its suppliers would continue operations supporting the manufacturing and delivery of vehicles, a person who had see the email told Reuters.

On Monday, several media outlets reported the factory would be allowed to remain open, but a spokesman for Alameda County on Tuesday said there was no definitive answer yet on how to keep workers safe.

The spokesman said he was also looking to connect with a Tesla official on the matter.

Tesla did not respond to a request for comment on Tuesday.

Tesla’s sole U.S. auto factory in Alameda County employs more than 10,000 workers and had annualized production of slightly over 415,000 units by the fourth quarter.

The county is one of six covered by a ‘shelter in place’ order from regional authorities that limits activity, travel and business functions to only the most essential, and advises people to stay home except for the most crucial reasons.

So far, automakers and their suppliers have avoided government-mandated production shutdowns in the United States.

The California governor’s on Tuesday referred to California’s Department of Public Health when asked whether the state planned to issue any shutdown guidelines for manufacturing facilities.

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That department in a statement said more guidance would likely be issued in the days ahead, but did not provide further details.

In an internal memo on Monday, Tesla Chief Executive Officer Elon Musk told employees he was not aware of any who had tested positive for the virus, and urged them to stay home if they felt the “slightest bit ill or even uncomfortable,” sources familiar with the matter told Reuters.

Bay Area counties had reported 273 coronavirus infections by Monday. California has reported six deaths from the COVID-19 respiratory illness caused by the virus.

Reporting by Tina Bellon in New York, additional reporting by Hyunjoo Jin in Seoul, Ann Maria Shibu in Bengaluru and Yilei Sun in Beijing; Editing by Cynthia Osterman, Paul Simao and David Gregorio

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