Elon Musk’s Leaked Email Explains Views on UAW, Working Hours

8 months ago by Eric Loveday 58

Elon Musk (Instagram: elon.musk.world)

Tesla has recently been in the headlines a bit for UAW activity at its Fremont factory.

Here are some prior posts with in-depth background info:

UAW Sends Organizers To The Tesla Fremont Factory

Tesla “Employee” Complains, Musk Disputes Claims, UAW Chimes In

With all the Union talk at Tesla, CEO Elon Musk decided to pen a lengthy email to Tesla employees. The email was then leaked to the media. We’ve reproduced it in its entirety below:

For Tesla to become and remain one of the great companies of the 21st century, we must have an environment that is as safe, fair and fun as possible. It is incredibly important to me that you look forward to coming to work every day. For that, we must be a fair and just company – the only kind worth creating.

This is vital to succeed in our mission to accelerate the advent of a clean, sustainable energy future. The forces arrayed against us are many and incredibly powerful. This is David vs Goliath if David were six inches tall! Only by being smarter, faster and working well as a tightly integrated team do we have any chance of success. We should never forget the history of car startups originating in the United States: dozens have gone bankrupt and only two, Tesla and Ford, have not. Despite the odds being strongly against us, my faith in you is why I am confident that we will succeed.

Tesla doesn’t want these fellas in a union at the company’s Fremont facility

That is why I was so distraught when I read the recent blog post promoting the UAW, which does not share our mission and whose true allegiance is to the giant car companies, where the money they take from employees in dues is vastly more than they could ever make from Tesla.

The tactics they have resorted to are disingenuous or outright false. I will address their underhanded attacks below. While this discussion focuses on Fremont, these same principles apply to every Tesla facility worldwide.

Safety First

The workplace issue that comes before any other is safety. If you do not have your health, then nothing else matters. Simply due to size and bad luck, there will always be some injuries in a company with over 30,000 employees, but our goal is simple: to have as close to zero injuries as possible and be the safest factory in the auto industry by far. The Tesla executive team and I are absolutely committed to this goal.

That is why I was particularly troubled by the safety claim in last week’s blog post, which said: “A few months ago, six out of eight people in my work team were out on medical leave at the same time due to various work-related injuries. I hear the ergonomics are even more severe in other areas of the factory.”

Obviously, this cannot be true: if three quarters of his team suddenly went on medical leave, we would not be able to operate that part of the factory. Furthermore, if things were really even worse in other departments, that would mean something like 80% or more of the factory would be out on injury, production would drop to virtually nothing and the parking lot would be almost empty. As you know firsthand, we have the *opposite* problem – there is never enough room to park! In fact, we are working at top speed to build more parking. Also, hopefully our darn BART train station will open before all hell freezes over!

Tesla Gigafactory “Pod Line” workers

After looking into this claim, not only was it untrue for this individual’s team, it was untrue for any of the hundreds of teams in the factory.

That said, reducing excess overtime and improving safety are extremely important. This is why we hired thousands of additional team members to create a third shift, which has reduced the burden on everyone. Moreover, since the beginning of Tesla production at Fremont five years ago, there have been dedicated health and safety experts covering the factory and we hold regular safety meetings with operations leaders. Since the majority of the injuries in the factory are ergonomic in nature, we have an ergonomics department focused exclusively on this issue.

The net result is that since January 1st, our total recordable incident rate (TRIR) is under 3.3, which is less than half the industry average of 6.7.

Of course, the goal is to have as close to zero injuries as humanly possible, so we need to keep improving. If you have a safety concern or an idea on how to make things better, please let your manager, safety representative or HR partner know. You can also send an anonymous note through the Integrity Hotline (this applies broadly to any problems you notice at our company) or you can email safety@tesla.com.

Compensation

At Tesla, we believe it is important for everyone to be an owner of the company. This is your company. That is why, unlike other car companies, everyone is awarded shares and you get to buy stock at a discount compared to the public through the employee stock purchase program. Last year, stock equity grants were increased significantly and it will happen again later this year once Model 3 achieves high volume.

The chart below contrasts the total comp received by a Tesla production team member who started on January 1, 2013 against the total comp received over the same period at GM, Ford, and Fiat Chrysler. A four year period is used because that’s the vesting length of a new hire equity grant. I believe the equity gain over the next four years will be similar. As shown below, a Tesla team member earned between $70,000 and $100,000 more in total compensation than the employees at other US auto companies!

Tesla Compensation Chart

Work Hours

Another issue raised in the UAW blog was hours worked. First, I want to recognize how hard you worked to make our company successful. Those hours mattered to you, to your family and to our company, and I can’t tell you how much I appreciate them.

However, the pace needs to be sustainable. This is why the third shift was established and why we created alternate work schedules based on feedback from various teams in the factory.

These changes have had a big impact. The average amount of hours worked by production team members this year is about 43 hours per week. The percentage of overtime hours has declined by almost 50% since the super tough time we had last year achieving rate on the Model X, which is probably the hardest car to build in history. What an amazing accomplishment! It is also a lesson learned, which is why Model 3 is designed to be dramatically easier to manufacture.

Fun

As we get closer to being a profitable company, we will be able to afford more and more fun things. For example, as I mentioned at the last company talk, we are going to hold a really amazing party once Model 3 reaches volume production later this year. There will also be little things that come along like free frozen yogurt stands scattered around the factory and my personal favorite: a Tesla electric pod car roller coaster (with an optional loop the loop route, of course!) that will allow fast and fun travel throughout our Fremont campus, dipping in and out of the factory and connecting all the parking lots. It’s going to get crazy good ?

Thanks again for all your effort and I look forward to working alongside you to create an amazing future!

Elon

Source: TechCrunch, The Street

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58 responses to "Elon Musk’s Leaked Email Explains Views on UAW, Working Hours"

  1. Peter says:

    “we are going to hold a really amazing party once Model 3 reaches volume production later this year.”

    I hope that this party will be really this year!

  2. John says:

    I want a roller coaster at work…

  3. Kdawg says:

    “a Tesla electric pod car roller coaster (with an optional loop the loop route, of course!)”
    ———-
    Well there goes the safety numbers. 😀

    1. Anderlan says:

      Seriously, there goes getting any reading or chalupa-eating done on the tram to your workstation…

  4. Pushmi-Pullyu says:

    A few random comments:

    1. I see Tesla identified the person who supposedly originated the complaint that the UAW has been using for propaganda to try to make Tesla’s Fremont assembly plant a UAW union plant. Last I’d read, there were at least two people with that name, and it was unclear which had written the letter, or if indeed that was just a pseudonym for the union activist.

    2. It should hardly be any surprise that the union activist’s claim that “six out of eight people in my work team were out on medical leave” was simply not true. This is exactly the sort of B.S. that we’ve come to expect from unions which have gotten so big that they’ve forgotten what the reason for which they were originally organized, which is to advocate for and protect the ordinary worker. You don’t do that by making and repeating Big Lies. This sort of nonsense is exactly why I think Tesla employees should resist the attempts by UAW to “organize” their factory. If employees need a union, then they should form their own, one which caters to their needs… and not the desires and political agendas of the executives of a national organization so large it no longer has much interest in the everyday needs of the ordinary rank-and-file.

    3. Seriously, a “fun” roller coaster as a way for employees to get around the Fremont “campus”? Listen, I love roller coasters. Whenever I visit an amusement park, they’re my #1 go-to activity. But I think “dipping in and out” of buildings on a ride to work every day would get pretty old, pretty fast.

    1. ¯\_(ツ)_/¯ sven says:

      Pu-Pu said:
      “It should hardly be any surprise that the union activist’s claim that “six out of eight people in my work team were out on medical leave” was simply not true. This is exactly the sort of B.S. . . .”

      The jury is still out on that point. Musk has been known to get the facts wrong or outright lie when it suits his purposes. Musk claimed that the mushroom-picking Tesla owner with the bad ball joints lived on at the end of a very long dirt road; that was simply not true. Musk said the Tesla received 40,000 reservations for the Powerwall version 1; that was simply not true. The list goes on and on.

      I don’t believe Musk when he claims in his letter that “if three quarters of his team suddenly went on medical leave, we would not be able to operate that part of the factory.” That is utter and complete B.S.. If six workers on one team went out on medical leave, six other workers would be quickly trained to take their place and workers on the from the eight-man team on second shift could also work some overtime, rather than shut down the entire factory. And for that matter IIRC, the worker very said the six went on medical leave “suddenly.” Musk is twisting the facts.

      Toyota and Honda rotate their workers every once in a while on the assembly line to do different jobs as a way of breaking the monotony of assembly line work. This has the added benefit of being able to “suddenly” reassign workers to other parts of the assembly line when the need arises, without the need to retrain them. Tesla could learn something from they way Toyota and Honda run their factories.

      The jury is also still out on whether this worker is truly disgruntled and has legitimate gripes about work conditions at Freemont, as opposed to merely spreading UAW propaganda as a surrogate of the UAW.

      1. Pushmi-Pullyu says:

        “Musk is twisting the facts.”

        So, serial Tesla basher Sven says he prefers the obvious propaganda in a union organizer’s screed, propaganda which closely follows the pattern of professional union organizers. The serial Tesla basher would prefer we take the propaganda at face value, in preference to the word of the CEO of the actual company involved; a company with a reputation of being far more open and transparent than is normal for the industry.

        Got it. 🙄

        1. ¯\_(ツ)_/¯ sven says:

          You’re just a dumba** fanboy who just days ago was pumping up Tesla’s stock after the earnings call, telling people to buy it because it was going to go up the next day. But instead the stock dropped like a rock the next day, and continues to drop like a rock today.

          1. Charlie H says:

            Haha I love it, you calling him a “dumba**” when you’re
            (Non) apparent intelligence makes an amoeba look like a highly intelligent and complex lifeform.
            When the only thing you’re capable of doing, is being overly critical of the achievements of others far more successful than yourself, it just reeks of petty jealousy, not constructive and meaningful criticism.
            So to what end do you continually “bash,” on Tesla?
            What pathetic agenda do you hope to advance? If it’s to make all your comments readers realize that your likely compensating for an overly small male member, don’t worry “job’s done.”

  5. SparkEV says:

    Musk table shows nice numbers, but Union and socialists will claim cost of living in CA is higher so they should get paid more. They won’t define what amount more, just more, more, more until the factory is no longer profitable and company goes bankrupt.

    It’s too bad Tesla isn’t in San Diego. It sounds like a fun place, even as second part time job.

    1. Nick says:

      It seems rational and greedy to attempt to get paid as much as you possibly can. That’s capitalism!

      1. SparkEV says:

        If “highest pay” involves thugs forcing other people from crossing union picket line and not respecting private property rights, that’s no capitalism. Simple fact is, union is organized crime composed of violent thugs.

        1. Windbourne says:

          Yeah, we never see ppl like gates or kock Bros cheat on their companies and strongarm other companies out.

          1. SparkEV says:

            Gates, etc. never threatened anyone with physical violence. Buying what you can afford is not “strongarm.” Unions literally use strongarm to enforce their extortion.

            1. Stimpacker says:

              Yup, Unions are thugs.

              “You don’t agree to my demands, I will cripple your operations”. They just love to picket and strike.

              Do they really care for their workers? Whenever they compromise, it is always the youngest workers who loses. The “seniors” will never give up anything.

        2. TomArt says:

          What planet are you from?

    2. Windbourne says:

      Too bad that you did not read or comprehend.
      Musk does not object to unions. He objects to UAW because they are working with Detroit executives to gut Tesla.
      IOW, UAW is acting like somebody from the gop; pure corruption.

      1. SparkEV says:

        I said nothing about Musk objecting to union. As for corruption, even worse than GOP is Democratic party, and union is even worse than them. In fact, union buys Democrat politicians more than GOP politicians.

      2. ¯\_(ツ)_/¯ sven says:

        “. . . acting like somebody from the gop; pure corruption.”

        As opposed the honesty and integrity of the Democratic National Committee, whose party bosses conspired with the corrupt Clintons in a back room to rig the primaries and give the nomination to Hillary, as opposed to letting Democrat primary voters choose the party’s presidential candidate? Bernie would have won the nomination of the Democratic Party if not for the corruption and collusion of the DNC and the Clintons, and would have gone on to defeat Trump to win the Presidency.

        Clintons = pure corruption.

        1. Pushmi-Pullyu says:

          That is, at the least, stating a lot of opinions as facts. If Bernie couldn’t even win the majority of support from the Democrats’ “base”, those dedicated party members who vote in the primaries, then he was even more unlikely than Hilary to win the general election.

          If it was difficult to believe that someone as obviously unfit for office as Trump would win the presidential election, it’s even more unlikely that a self-avowed Socialist would ever win the general election.

          1. ¯\_(ツ)_/¯ sven says:

            Bernie didn’t win the primary because the DNC rigged it so that Hillary would win.

            The people didn’t want another typical insider politician, which is exactly what Crooked Hillary was. Bernie was an outsider like Trump, but much more palatable.

      3. Paul says:

        The UAW actually almost had a deal with the Tesla but blew it by demanding that seniority be carried across from the old plant, which was a bit ridiculous considering the different technologies involved.

        I wouldn’t be surprised if we find out the initial story was true when it happened, but it just doesn’t happen that often. (i.e Musk is talking about generally, while the blog posting was referring to a specific case)

        1. Pushmi-Pullyu says:

          I would be extremely surprised to find out that any of the various claims made in that UAW organizer’s letter of complaint was entirely true, or even mostly so. More likely, at best those claims contained only a tiny bit of truth, with the actual Truth twisted beyond all recognition.

          For example, the claim that “six out of eight people in my work team were out on medical leave at the same time due to various work-related injuries.” That reads suspiciously like words carefully chosen to twist the truth beyond all recognition, to fit the union organizers’ boilerplate claims of dangerous workplace conditions. At least, that’s what it reads like to me. And I know from previous discussions of this topic that I’m not the only one of us Usual Suspects who thinks so.

          Bottom line: The letter of complaint used as the excuse for this effort at UAW union organizing simply isn’t credible. Even put up against Elon’s tendency to shoot his mouth off without carefully checking the facts, it’s still not credible.

  6. Nemo says:

    So much for “union-neutral”.

    1. Pushmi-Pullyu says:

      Since when does refuting the lies in propaganda with actual facts show bias?

      If being in favor of Truth is biased, then we should all be biased!

    2. Windbourne says:

      Musk us union-neutral. He is opposed to UAW since that have the same integrity of the GOP; IOW, a bunch lying thugs that would rather be traitors, than do their jobs.

      1. needa says:

        Lol. You really should pay more attention to politics if you are going to constantly comment on it.

      2. zll says:

        OH….remind me again which presidential candidate UAW endorsed? Was it a Democrat or GOP?

  7. William says:

    Crazy good work environment has a loop the loop coaster. Wow, the Freemont factory has the fun factor competing with the happiest place on earth.

  8. Warren Hurd says:

    My last five cars were union made. My next one will not be!

    1. Warren Hurd says:

      Pardon me, that would be seven cars.

  9. Good letter, it sounds like Mr. Musk is on top of it.

  10. vik says:

    Really where are these numbers are coming from, I know personally people that work for GM and the new hires were getting around $17 per Hr., even with bonuses from this year’s profitability, $199,000 seems way off. As for other car companies, I know people that work in the maintenance department at Kia’s WestPoint plant in Georgia, and as automation engineers they make about $65,000 and the line worker makes $37,000. I really doubt tesla is somehow delivering a $198,000 salary for each worker before benefits. I work in automation and understand some of the issues with Unions but if Fremont unionized and Elon were to pay less to his workers why wouldn’t he be for it. I have heard about the control engineers at tesla, its a high stress, high turn over position, and though I don’t know exact details about the line worker’s benefits I’m assuming some of the stress is the same for them. this email seems to be deceptive, and Tesla has other motives than just what is stated in the email, and I would like sources for their wealth delivered calculations.

    1. SparkEV says:

      $17/hr is about $40K/yr with some overtime. 4 times that is $160K. The table shows $157K. Where do you see $199K?

      I think you’re confusing 4 yr with 1 yr, but $199K makes no sense.

      1. Vik says:

        Cash total for GM is shown as $199,000 over 4 years in left most column, really all I was saying is the table makes it out better for all employees than they really are, maybe they are averaging in skilled trade workers, but regardless wages are abysmal compared to even 10 years ago in the industry. Also comparing the average from 2013 to now is deceptive because almost every company gave raises recently just compare the last year or the last 2 years.

        1. SparkEV says:

          O I C. You were talking about GM. But Tesla figure is close to what would result from $17/hr employee. Could it be that GM gives more than $17/hr on average to make up for having no equity?

        2. vik says:

          The thing I hate the most is that big three are not paying their employees as much as they did before 2008 for the same jobs. All the other foreign companies manufacturing the south pay around $10/hr, which is even worse.

          Tesla justifies its salaries based on that in California where cost of living is pretty high. This is why the middle class is dying there are less people (Due to Automation) making a lot less money compared to the past. If they don’t like the UAW then they should form another Union to demand a salary that will get you at least in the lower middle class with a little bit of overtime.

      2. Danny says:

        The starting wage for an hourly worker at Ford is $17 an hr. Every year that worker receives a $1.50 raise per hr on their seniority date. So by the fourth year that worker will be earning $22.50 an hr. That same scale continues until that worker reaches top scale pay of over $28 per hr. I have worked there for a little over two years and have earned roughly $130,000.00 in wages and bonuses to date. This does not include insurance because I have no idea how much my health, vision and dental cost because I don’t have to pay premium. I do know that any one of the big three provide some great medical benefits. By the scale above that put my earnings and benefit package around $220,000 to date. Like I said, I’ve only been there for just over two years. To be specific, two years and 19 days. So I would assume in two more years with myself making $3 more an hour I think it is safe to say my total benefits package will total over $440,000. That would actually put my benefits package around $83,000 above the Tesla package in four years. It’s hard to say how much more when I reach top pay. All of this was made possible by the UAW. So before stating false facts, ask someone who is actually represented by them.

  11. Windbourne says:

    The author needs to reread that letter. Musk does not object to unions. He objects to UAW, which is a corrupt union.

  12. Surya says:

    I don’t understand the US union system. It seems screwed up.

    1. Axel Holm says:

      Yes, for a swede it seems really wierd. Most swedes are part of a union, why have us people such problems with them?

      1. pjwood1 says:

        Many in the US culturally believe labor doesn’t need to organize, to succeed, and won’t recognize what has been lost over decades:
        -Private company pensions
        -Health care
        -Wages

        It’s just “Another American Point of View”, but I think we still haven’t reached the trough. The high cost of government unions, that we’re only beginning to recognize, is keeping a negative light on any, and all, unions in the United States. It probably gets worse, before it gets better. In my opinion, many Trump voters are ashamed to admit virtue in organized labor, and believe limiting international trade and immigration will fix the problem.

        1. MikeG says:

          Well stated. I’m surprised how people in the US have visceral hatred for unions. It’s amazing how well the 1% have convinced Americans that organized labor is a bad thing.
          It’s good that you remind people what we have given up. Here are a few more things we haven’t lost yet:
          – 40 hour workweek
          – Labor Day

          1. Pushmi-Pullyu says:

            “It’s amazing how well the 1% have convinced Americans that organized labor is a bad thing.”

            Entirely true. But perhaps you’re missing the fact that a lot of Tesla owners or wannabe owners — including many of those posting here — are either in that 1%, or aspire to be to the point that they have internalized the same philosophy.

            And to be fair, a lot of the workers’ rights which unions were first organized to advocate for, such as the 40-hour work week, paid overtime, sick leave, etc. are now guaranteed by State laws. About the only benefit left for unions is collective bargaining for salaries and benefits. And we’ve seen what happens to bargaining for such benefits when unions get too big and powerful; they wind up leveraging such inflated salaries and benefits that the business those employees work for can’t compete, and many or most of those jobs just disappear. The overreach by the UAW was a big part of why Detroit is now part of the “rust belt”, with most of the good paying jobs lost.

            Once unions get so big that they attract the attention and influence of organized crime, then they are most definitely too big.

            1. TomArt says:

              Detroit’s downfall was not of the UAW’s making – it was the decreasing clout of the UAW, and Labor in general, on Capitol Hill that led to permissive trade deals that moved the manufacturing jobs overseas. The UAW leveraged what they had, but the so-called “conservative revolution of 1980” pulled the rug out from under the middle class.

          2. TomArt says:

            We haven’t lost a 40-hr work week? Well, that maybe true for blue-collars and trades, but the white collar world drank the “conservative” kool-aid with the gusto of keg-stands.

            Salaried employees are run into the ground in the US. The “logic” is that they are being paid to do a job, not the number of hours worked. So, they are overworked, and they fear retribution or being passed over for promotions if they ask for overtime pay, raise the issue of burdensome workloads, or use paid time off, etc.

  13. HVACman says:

    It appears a good chunk of the typical Tesla employee compensation is related to stock equity awarded as a new-hire “bonus” and for performance. It would appear another value included in the compensation is the value of the ESPP, which is probably the projected value of the discount an employee would realize IF they have the available extra cash, and the moxy to invest all of it, by purchasing the maximum eligible amount of Tesla stock.

    IOW, Tesla employees are well-compensated relative to other auto manufacturers ONLY if they can have the patience to see Tesla’s stock grow in value in value AND they can liquidate their stock or Tesla starts paying dividends.

    This is a pretty big financial roll of the dice…not something most workers on the assembly line are in a position to make.

    1. Spider-Dan says:

      Yeah, this is the real takeaway from this memo.

      If you look at salary, healthcare, PTO, Tesla is last by a SIZABLE margin, even though Tesla is located in one of the most expensive areas of the country. But Tesla includes stock equity to “balance the books.”

      I’m going to make a wild guess and say that stock options have to vest before you can sell them. If that’s the case, Elon might as well be talking about how many IOUs he issues to his employees and comparing it in a chart.

      1. TomArt says:

        Yes, an explanation would help.

  14. Sonya Wiley says:

    Hey Elon
    Is it true your running out money? If so I can help.

    Let me know it could be very profitable for the both of us? don’t be shy or was you just saying that on my behalf?

    Sonya Wiley

  15. Sonya Wiley says:

    Elon
    Your Mom’s lovely by the way.

  16. (⌐■_■) Trollnonymous says:

    UAW is a virus that will inevitably kill it’s host.

    Remember the “Job Banks” they strongarm negotiated?

    http://www.cnbc.com/id/28894663

  17. Foo says:

    Where’d they get that cool picture of Elon from the 1960’s?

  18. Wow…how many of you guys are in the UAW? ORGANIZED CRIME GIVE ME A BREAK, YOU GUYS WATCHED GOODFELLAS TOO MANY TIMES. AS A FORTH GENERATION AUTO WORKER FROM DETROIT MY FAMILY HAS BEEN BUILDING CARS IN THIS CITY WHEN Fords was still in Detroit…going back almost 100 years.

    Collective Bargaining gives you a say and a seat at the table. Improves the lives of your family and your community. As the Working Class not the Investing Class we spend a majority of our money on new cars, houses,travel,our kids and other expenditures that fuel local businesses.

    Organized Labor works only when everybody in that Secor is organized if not if creates an unfair advantage to the unorganized. By creating a fake facade of the UAW taking down their host. Bottom line is UAW puts it’s Members first…not profits or Shareholders with safety being it’s number one priority. If we leave Workers Right up to the States Law Makers, workers will always get the short end of the stick.

    US Supreme Court ruling Citizens United has hurt not only Labor Unions, Working Poor, Immigrants, Minorities, Women but our democracy in giving Corporations and Super PACS the ability to buy Politicians to write their own legislation and PR campaigns against Working Families.

  19. Ted says:

    My dad was a Teamster, my grandfather was a teamster, mom was a union seamstress, I lived in a Union house, so I’ve seen a few things… My observation is that employees don’t “want” to be in a Union, they want to be treated fairly, and feel that management is concerned for their wellbeing.
    In a “Perfect World” employees would be paid enough to take care of their family’s needs and be able to live in reasonable comfort while working and when retired. They would also like to see their children educated so that they could have even better job prospects than they had.
    When an employer does not provide for these aspersions, the employees seek the strength and protection of a Union. In my childhood, there were more than a few times when dad said “I’m walking the line today.” And we all knew what that meant. He didn’t “want” to picket, he wanted to work. But that’s how it worked. So, my advice to Management, treat your employees like part of the solution, not part of the problem, and the stockholders will be happier.

    1. TomArt says:

      Agreed. Well-said.

  20. Mister G says:

    If Tesla employees want to unionize let them do it. But don’t let the union have any overhead costs, it can be a Facebook union without any dues or salary for the union leadership. Meetings are held online, negotiations are done on days off, and Tesla won’t lawyer up.

  21. coolhanc says:

    UAW is just pushing toward the eventual end: automation.
    I’m glad they are hastening it.