Workers at Tesla are focus of union

6,200 employed at California site

Customers check out Tesla vehicles outside a store in Mexico City earlier this year.
Customers check out Tesla vehicles outside a store in Mexico City earlier this year.

SAN FRANCISCO -- The United Auto Workers union is attempting to organize workers at Tesla Inc.'s nonunion electric car factory in Fremont, Calif., just as production of the Model 3 reaches a critical state.

Tesla plans to produce hundreds of thousands of the mid-priced electric cars each year. The Model 3 needs to be a big hit to justify high stockholder expectations and billions of dollars in capital investment at Tesla, which now sells not only cars but also batteries and solar roofs.

Mass-producing high-quality, low-cost cars is a challenge, especially for a company that has never done it before.

Whether the United Auto Workers enjoys solid support among the workforce of 6,200, or just the support of a few chance-takers, a union drive stands to divert Chief Executive Elon Musk's attention. Unlike in many states, California laws and regulations make it relatively easy for union organizers to solicit converts inside the workplace without retribution from management.

Musk, a South African immigrant whose rise in the business world occurred in union-thin Silicon Valley, is getting a taste of what most Californians take for granted. As Harley Shaiken, a labor professor at University of California, Berkeley, puts it: "California overall is a labor-friendly state."

That fact struck a nerve with Musk last week when a worker at Tesla's Fremont factory, Jose Moran, uploaded a critical post on Medium. It lambasted the electric-car maker for what Moran said was employee mistreatment: preventable injuries, long hours, bad ergonomics, few if any promotions, safety issues. Many of those complaints, Moran said, had been ignored.

Moran also announced that he was talking with the United Auto Workers about organizing workers at the plant.

Musk reacted with a flurry of tweets: The "guy was paid by the [United Auto Workers] to join Tesla and agitate for a union," he tweeted to the website Gizmodo. "He doesn't really work for us, he works for the [union]."

"Tesla is the last car company left in California, because costs are so high," came another tweet. Moran's piece, Musk continued, is "morally outrageous."

The "intensity of his response" suggests that Musk is taking the latest attempt seriously, Shaiken said.

The United Auto Workers said it's working with Moran but is not paying him. A Tesla spokesman declined a request for an interview with Musk, and Moran did not respond to inquiries.

The union has tried to penetrate Tesla in the past, to no avail.

Still strong at General Motors, Ford Motor and Fiat Chrysler, the United Auto Workers' attempts to organize Japanese, Korean and German auto plants in Southern states over the decades have come to naught.

A union could hold extra negotiating clout with Tesla given the importance of the Model 3 and the pressure on Tesla to turn it out.

Tesla sells highly successful but niche-oriented luxury cars, the Models S and X, at a rate of about 80,000 a year.

But the United Auto Workers' chances at Tesla are slim, according to a former union official who worked at the plant for 22 years before Tesla bought it in 2010. The plant was previously jointly run by Toyota and GM.

"To be honest with you, I think they're going to have a hard time" organizing workers, said Sergio Santos, who was president of United Auto Workers Local 2244 in Fremont.

The workers want Tesla to succeed, he said. "Half the people in there are just happy to have a job."

There have also been political attempts to aid Tesla workers.

Last month, five members of the California Assembly wrote a letter to Musk to protest a confidentiality agreement that Tesla workers were asked to sign in November. The agreement bars them from discussing "everything you work on, learn or observe in your work" unless it's already public information.

The broad language is a violation of federal labor law, the group said.

Tesla lawyer Todd Maron responded with a letter explaining that the company legitimately sought to stanch leaks about product releases and vehicle features that Tesla would rather competitors not know.

Business on 02/18/2017

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