Tesla Claims Employee Tried to Sabotage Plant – But Refuses to Say if Authorities Were Notified

Musk blames employee who didn’t receive promotion, hints others might be involved.

by on Jun.19, 2018

In a letter to employees, Tesla CEO Musk said the Fremont plant was the subject of sabotage.

Tesla CEO Elon Musk advised employees late Sunday that the company had been sabotaged by an employee who sent “highly sensitive” data to unnamed outside parties, but he and Tesla have so far refused to provide details, declining to even say whether police or other authorities, such as the FBI, have been asked to investigate.

Musk’s e-mail to Tesla workers, first reported by CNBC, was sent hours after a small fire at the Tesla assembly plant in Fremont, California briefly shut down due to a fire in its welding area. The incident was deemed minor and work quickly resumed. Tesla has been struggling to boost the factory’s output, primarily of the new Model 3 sedan, and has gone to an around-the-clock production schedule.

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In his note to employees, Musk said an employee committed “quite extensive and damaging sabotage to our operations,” among other things making “direct code changes” in Tesla’s manufacturing system while also sending “large amounts” of “highly sensitive” company data to an address outside the company.

He did not, however, indicate whether the alleged sabotage actually resulted in any delays or damage at the Fremont plant. Even a minor glitch could be costly for Tesla, however. The carmaker has been running substantially behind its original target for Model 3 production and has seen a growing number of advance reservation holders cancel out as the delays continue. The production shortfall, meanwhile, was the primary factor behind Tesla’s record losses during the first quarter.

CEO Musk has told employees he will all but live out of the plant as it pushes to increase output.

(NTSB investigating latest Tesla vehicle fire. Click Here for the story.)

In recent weeks, Musk has suggested Tesla is getting back on track, with production likely to top 5,000 a week by the end of the second quarter – a nearly 250% jump from the prior quarter – while the company is on target to become both profitable and cash-flow positive during the second half of 2018.

(Why is Tesla slashing 9% of its workforce? Click Here for the story.)

While meeting those three goals would be significant milestones sought by Tesla’s generally bullish shareholder base, there are others who might not have minded if Tesla were to run into serious problems, Musk implied. Those could include not only short-sellers who are betting on Tesla stock to tumble but also competitors who’d rather not see its push into the automotive market succeed

“Don’t want to blow your mind, but rumor has it that those companies are sometimes not super nice,” he wrote. “If they’re willing to cheat so much about emissions, maybe they’re willing to cheat in other ways?”

Asked by TheDetroitBureau.com who that might be, and whether Tesla has a specific competitor in mind, Tesla declined comment. But the reference to those “willing to cheat” on emissions would suggest several companies, notably including Volkswagen, the German manufacturer that has confirmed rigging about 11 million diesel vehicles sold worldwide to illegally pass emissions tests.

Anything that delayed Model 3 production could cause serious problems for Tesla.

A Tesla spokesman also declined to comment about the details of the investigation into the sabotage, notably whether Tesla has asked authorities, such as local or state police, possibly even the FBI, to investigate Musk’s allegations. Certainly, if an employee did make unauthorized changes to company code or transmit Tesla’s intellectual property to someone outside the company, it could be considered a crime under a variety of state and federal statutes.

Tesla also has so far declined to identify the person accused of committing the sabotage, even to the point of saying whether that person has been fired. Musk’s letter only suggested that the employee apparently acted out of an effort to receive a promotion.

But Musk did ask employees to be on the lookout, going forward, to see and report “anything that’s not in the best interests of our company.” He quoted former Intel CEO Andy Grove who once said that, “only the paranoid survive.”

(Jaguar poses serious challenge to Tesla with new I-Pace electric SUV. Click Here for a review.)

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2 Responses to “Tesla Claims Employee Tried to Sabotage Plant – But Refuses to Say if Authorities Were Notified”

  1. Allen says:

    “…a fire in its welding area.” What were the chances of a fire around welding equipment?

    As far as the alleged sabotage, I sense this is more likely a way to keep Tesla in the headlines. No evidence, no authorities ed…

    • Paul A. Eisenstein says:

      See our follow-up story going live shortly.