Tesla Files Lawsuit Against COVID-19 Lockdown

  • Tesla has decried California lockdown measures.
  • The company has received a loan to expand its China operations.
  • The money can only be used to cover expenditures in China.

On May 9, Tesla CEO Elon Musk decried coronavirus lockdown measures that halted operations at his company’s main factory. Now, the billionaire has threatened to shift Tesla operations out of the state of California, to Texas or Nevada, where coronavirus lockdown bylaws are friendlier.

Tesla, Inc. is an American electric vehicle and clean energy company based in Palo Alto, California. The company specializes in electric vehicle manufacturing, battery energy storage from home to grid scale and, through its acquisition of SolarCity, solar panel and solar roof tile manufacturing.

The following is an excerpt from his most recent statement regarding the move:

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

A few hours later, Tesla lawyers reportedly filed a lawsuit in the Northern District of California Court seeking an injunction against, what they called, the county’s penal lockdown measures. According to the filing, the current rules have crippled business operations and affected critical infrastructure sectors.

Local authorities have prevented Tesla from reopening its factory. There had been allegations that Tesla was planning to go ahead with manufacturing operations from May 6. The local authorities have, however, refuted the claim while underlining that the company is still not allowed to do this.

According to Geneva Bosques, the Fremont Police Department spokeswoman, there are no changes in the law permitting Tesla to resume operations. “Right now, the same health order is in place so nothing has changed. Operating the assembly line was determined early on to be a violation.”

Elon Musk said last week, after his car company’s first-quarter earnings announcement, that the current shutdowns are a substantial risk to business. He said:

Elon Musk is an engineer, industrial designer, technology entrepreneur and philanthropist. He is the founder, CEO and chief engineer/designer of SpaceX; co-founder, CEO and product architect of Tesla, Inc.; founder of The Boring Company; co-founder of Neuralink; and co-founder and initial co-chairman of OpenAI.

“If somebody wants to stay in their house, that’s great and they should be able to. But to say they cannot leave their house and that they will be arrested if they do, that’s fascist. That is not democratic — this is not freedom. Give people back their goddamn freedom.”

Tesla reported a net profit of $16 million in the first three months of 2020, and $5.98 billion in revenue. Analysts, however, expect the Covid-19 epidemic to hit its earnings this year.

Tesla Expanding China Operations

Tesla has reached an agreement with a Chinese bank for an unsecured loan of up to ¥4 billion ($565 million). This is according to a regulatory filing made on Friday. The credit will be used to expand production at its Gigafactory in Shanghai.

The lender is a subsidiary of the Industrial and Commercial Bank of China, and was involved in a ¥9 billion ($1.29 billion) loan to the company last year. The arrangement included a collective of Chinese lenders.

Tesla received a ¥2.25 billion loan at the time. All funds provided will only be used to cover expenditures tied to its production facility in Shanghai. Both loans come with spending restrictions. The money cannot be used by the company to cover expenses outside the country.

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Samuel Gush

Samuel Gush is a Technology, Entertainment, and Political News writer at Communal News.

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