California based electric vehicle and clean energy company Tesla has reportedly decided to furlough all non-essential employees and execute a cut in their pay during the shut down of its production facilities across the U.S. owing to the COVID-19 pandemic.  

In a bid to manage costs and achieve long-term goals, the company recently suspended production at its New York solar roof tile and San Francisco Bay Area vehicle factories. Reportedly, the coronavirus outbreak has largely affected the demand for vehicles across the U.S. and compelled automobile manufacturers to furlough U.S. workers.

For the record, from April 13, Tesla employees will witness a deduction in their salaries and the cut will continue until the end of the second quarter of the year.

Apparently, the workers in the U.S. are expected to witness a pay cut by 10%, the salary of directors to be cut by 20% and salaries of vice-presidents to witness a deduction by 30%. Comparable deductions to be implemented overseas.

Notably, the employees who are facing difficulties in working from home and those who have not been assigned any crucial job onsite factories will be furloughed, with workers managing their healthcare benefits till the time production resumes.

Citing reliable sources, last month, the automobile giant halted production at both factories after it dismissed a standoff with authorities regarding the rapid spread of the virus.

Seemingly, Tesla’s sole automobile factory in the U.S. employs over 10,000 workers and boasts annual production of more than 415,000 units towards the end of December 2019.

In a statement by Elon Musk, CEO at Tesla, the suspension comes in way of a planned ramp-up in the manufacturing of its Model Y SUV at the factory. The demand for Model Y sports utility vehicle is likely to be higher than that of all other Tesla models combined. The new Model Y meets the demand for SUVs and is less expensive as compared to the high-end Model X.

The company aims at resuming its operations from May 4, unless there are any significant changes.

Source Credits: https://www.reuters.com/article/us-health-coronavirus-tesla/tesla-to-furlough-workers-cut-employee-salaries-due-to-coronavirus-idUSKBN21Q0CO