Tesla will close “about a dozen” solar installation facilities around the country as part of its recent layoffs, according to Reuters. Installation centers in California, Maryland, New Jersey, Texas, New York, New Hampshire, Connecticut, Arizona, and Delaware will be shuttered. Workers will be laid off or reassigned to other sites. About 60 similar facilities will remain open. The installation centers were opened when Tesla’s solar panel wing, SolarCity, was still an independent company. Tesla sells home batteries and is developing solar roof tiles under its own branding, and since it acquired SolarCity for $2.6 billion in late 2016, it has worked to trim the solar panel provider’s operations (sometimes through layoffs) and better integrate them into its existing store experience. In a letter to shareholders at the end of the first quarter of 2018, Musk said the company has “increased efforts to sell energy generation and storage systems in Tesla stores,” hinting that further consolidation was in the works. Tesla also announced that it was ending a deal where it sold its solar energy products at Home Depot. While the original relationship between SolarCity and Home Depot dates back more than five years, Tesla announced an expansion to this partnership in February. These changes came with layoffs at Tesla that cut 9 percent of the workforce, or more than 3,000 people, as part of what CEO Elon Musk has called a “difficult, but necessary Tesla reorg.” Got a tip for us? Use SecureDrop or Signal to securely send messages and files to The Verge without revealing your identity. A spokesperson for Tesla declined to comment on the specifics of the closures but said that the company expects Tesla’s solar and battery business to eventually be the same size as its automotive side. “One of the main reasons we acquired SolarCity was to use our Tesla stores to sell not only cars, but also Powerwall and Solar. Tesla stores have some of the highest foot traffic of any retail space in the country, so this presents a unique benefit that is demonstrated by the growing number of Tesla vehicle customers who are also purchasing energy products through our stores. The reorganization that we announced last week does not impact this.” In an email to employees, Musk said the decisions involving the “company-wide restructuring” were made “by evaluating the criticality of each position, whether certain jobs could be done more efficiently and productively, and by assessing the specific skills and abilities of each individual in the company.” Tesla’s automotive business has recently struggled to generate enough revenue to offset the production of the Model 3, the company’s first electric car for the mass market. Tesla’s acquisition of SolarCity generated some controversy, as SolarCity was founded by two of Musk’s cousins, and Musk served as the chairman of the company’s board of directors while also running Tesla. Tesla shareholders eventually filed a lawsuit claiming that the Tesla board breached its duties by approving the merger. The case is still working its way through Delaware chancery court.<doc-sep>Tesla is closing down solar panel sales and installation facilities in nine states, Reuters reports, citing current and former employees of the company’s solar business as well as internal documents. The documents name 14 solar panel installation locations of what was previously SolarCity across nine states as well as a suspension of a retail partnership with Home Depot. This partnership, Tesla employees told Reuters, brought in half of the solar business’ sales. This leaves Tesla’s solar operations with 60 sales and installations facilities nationwide. The company has declined to provide details as to the size of the workforce that will become redundant with the closures. Last week, Tesla said it will cut its total staff by 9 percent as it strives for greater cost efficiency. Regarding the end of the partnership with Home Depot, the move is part of a strategy to make SolarCity’s business an organic part of Tesla, including selling its products via Tesla stores and the company’s website. Reuters, however, quoted an analyst as saying the message that the market received with the shutdowns and the end of the Home Depot partnership was that Tesla had “no strategy for selling solar.” Related: Permian Bottlenecks Begin To Bite Tesla acquired SolarCity for US$2.6 billion plus the assumption of another US$3 billion in SoalrCity debt in 2016. At the time many questioned the wisdom of such an acquisition given that SolarCity was a cash burner, but since then Tesla has streamlined the company’s operations as it pursued its plan of growing into a one-stop shop for energy solutions, from batteries to solar rooftops. Right now, Tesla’s number-one priority is to meet the deadline for ramping up the Model 3 production rate to 5,000 cars weekly, which should happen by the end of this month. The company is facing growing investor concerns about its approach to cash and deadlines, so chances are it will really try to meet this deadline, whatever it takes. By Irina Slav for Oilprice.com More Top Reads From Oilprice.com:<doc-sep>Tesla's layoffs last week will affect what had been the company's solar panel division according to Reuters, which says it has seen several internal documents and spoken to seven current and former Tesla solar employees. If true, the move marks a change in strategy by CEO Elon Musk, who two years ago fought ardently to add solar panels to the car company's portfolio. In 2006, Musk helped to form a solar panel company founded by his cousins, SolarCity. Focused on commercial and home installation, SolarCity soon rose to prominence as one of the biggest solar installers in California. By 2013, it had become the second-largest non-utility solar installer company in country. As the company began to attract more attention nationally, Musk's interest in SolarCity grew. In March 2016, his space transportation company, SpaceX, bought $90 million worth of SolarCity stock. And just a few months later in June 2016, Tesla proposed acquiring SolarCity outright. Over 85 percent of Tesla shareholders approved the purchase at the time, with Musk calling the purchase "blindingly obvious." The goal was to create "the world's only vertically integrated sustainable energy company." Showing his confidence in the purchase, Musk installed SolarCity panels on his own house. Now Tesla is looking to close around a dozen installation facilities, according to internal company documents, and is ending its sales partnership with Home Depot. That partnership made up half of Tesla's solar panel sales. Publicly, the company has denied a change in solar panel strategy. “We continue to expect that Tesla’s solar and battery business will be the same size as automotive over the long term,” Tesla said in a statement to Reuters. 60 installation facilities remain open, although Reuters says it has seen documents listing 13 or 14 of these slated for closure as well. Source: Reuters This content is created and maintained by a third party, and imported onto this page to help users provide their email addresses. You may be able to find more information about this and similar content at piano.io<doc-sep>Electric car maker Tesla's move last week to cut 9 percent of its workforce will sharply downsize the residential solar business it bought two years ago in a controversial $2.6 billion deal, according to three internal company documents and seven current and former Tesla solar employees. The latest cuts to the division that was once SolarCity — a sales and installation company founded by two cousins of Tesla CEO Elon Musk — include closing about a dozen installation facilities, according to internal company documents, and ending a retail partnership with Home Depot that the current and former employees said generated about half of its sales. About 60 installation facilities remain open, according to an internal company list reviewed by Reuters. An internal company email named 14 facilities slated for closure, but the other list included only 13 of those locations. Tesla declined to comment on which sites it planned to shut down, how many employees would lose their jobs or what percentage of the solar workforce they represent. The company said that cuts to its overall energy team — including batteries to store power — were in line with the broader 9 percent staff cut. "We continue to expect that Tesla's solar and battery business will be the same size as automotive over the long term," the company said in a statement to Reuters. The operational closures, which have not been previously reported, raise new questions about the viability of cash-strapped Tesla's solar business and Musk's rationale for a merger he once called a "no-brainer" — but some investors have panned as a bailout of an affiliated firm at the expense of Tesla shareholders. Before the merger, Musk had served as chairman of SolarCity's board of directors. The installation offices that the internal email said were targeted for closure were located in California, Maryland, New Jersey, Texas, New York, New Hampshire, Connecticut, Arizona, and Delaware. The company also fired dozens of solar customer service staffers at call centers in Nevada and Utah, according to the former Tesla employees, some of whom were terminated in last week's cuts. Those employees spoke on condition of anonymity because making public comments could violate the terms of their severance packages. "It's been a difficult few days — no one can deny this," a Tesla manager wrote in a separate internal email, sent to customer service employees shortly after the cuts were announced. Tesla has been burning through cash as it tries to hit a target of producing 5,000 Model 3 electric sedans per week after production delays. The company faces investor pressure to turn a profit without having to tap Wall Street for additional capital. The total number of cuts to the solar workforce remained unclear. Some personnel at facilities closing down were being transferred to other sites, the current and former employees said. SolarCity employed about 15,000 people at the end of 2015 but has since cut thousands of workers. Ending the Home Depot partnership, which allowed for solar sales in about 800 stores, is part of Tesla's larger effort to absorb SolarCity into its high-end brand and sell through 90 of its 109 U.S. retail stores and its website, the company said. "Tesla stores have some of the highest foot traffic of any retail space in the country," Tesla said. Analysts questioned Tesla's plans for the solar business in light of the latest cuts to staff and retail operations. "In effect, they seem to be saying, We have no strategy for selling solar," said Frank Gillett, an analyst at Forrester Research, adding that the SolarCity purchase "looks pretty awful right now." Falling sales In the first quarter of this year, Tesla installed 76 megawatts of solar systems - down from SolarCity's more than 200 MW a quarter in early 2016, when it was the leading player in the industry. In announcing quarterly results in February, Tesla said growth in solar deployments would resume later this year. Tesla's falling solar sales also could jeopardize the future of a joint venture with Panasonic, announced as Tesla moved to acquire SolarCity in 2016, to produce solar modules at a new factory in Buffalo, New York. Tesla has an agreement with New York state requiring the company to spend $5 billion within 10 years. If Tesla fails to meet that obligation and others, the company may be required to pay tens of millions of dollars in penalties at various milestones, could lose its lease, or be forced to write down the assets, the company told investors in a May filing. In response to questions from Reuters, Tesla said it is meeting its hiring and spending commitments for the factory. In March, a Delaware judge ruled against a Tesla motion to dismiss a lawsuit by the company's shareholders over the SolarCity deal. The lawsuit alleged Tesla's board of directors breached its duties to shareholders by approving the merger. SolarCity founder Lyndon Rive, who is Musk's first cousin and left Tesla last year, did not respond to a request for comment. High marketing costs The move to end the longstanding Home Depot partnership blindsided many staffers because Tesla had announced an expansion of the arrangement as recently as February. GTM Research analyst Austin Perea estimated the partnership has recently accounted for about half of sales, in part because of previous Tesla moves to cut back on other sales and marketing costs. Such third-party retail partnerships are among the most expensive means of generating solar sales, according to the clean energy research firm, in part because retailers take a cut of each sale. The cost of winning a customer through a store like Home Depot can be up to $7,000 per system, according to GTM Research, compared with a national average of $4,000 per installation. Home Depot spokesman Stephen Holmes said the retailer's relationship with Tesla would last through the end of the year, adding that Home Depot would continue a partnership with Tesla competitor Sunrun in an undisclosed number of stores.<doc-sep>
Tesla will close up to 14 solar installation facilities, Reuters reports. A Tesla representative declined to comment on the number of solar installation facilities the company is closing but told Business Insider that cuts to the company's energy division were consistent with the company's overall rate of 9%. The representative also said that, over the long term, Tesla's energy and electric vehicle businesses will be the same size. Last week, Tesla CEO Elon Musk said the company would not renew its agreement with Home Depot to sell solar panels and battery packs at the retailer's stores. Tesla will close up to 14 solar installation facilities, Reuters reports. Internal documents reviewed by the publication listed the either 13 or 14 facilities Tesla plans to close. The closures will affect installation facilities in California, New York, Texas, Maryland, New Jersey, New Hampshire, Connecticut, Arizona, and Delaware, according to Reuters. Around 60 facilities will reportedly stay open. A Tesla representative declined to comment on the number of solar installation facilities the company is closing but told Business Insider that cuts to the company's energy division were consistent with the company's overall rate of 9%. The representative also said that, over the long term, Tesla's energy and electric vehicle businesses will be the same size. Last week, Tesla laid off about 9% of its employees in an effort to cut costs and eliminate redundancies, CEO Elon Musk said. Musk has said that Tesla will become profitable in the second half of 2018 and won't need to raise money for the rest of the year, despite skepticism from some investors and analysts. Tesla has been known to spend cash quickly and post consistent losses in the 15 years since its founding. The company posted an adjusted loss of $3.35 per share on revenue of $3.41 billion during the first quarter. Analysts had predicted an adjusted loss of $3.42 per share on revenue of $3.32 billion. Musk also said last week that the company would not renew its agreement with Home Depot to sell solar panels and battery packs at the retailer's stores. Musk said most Tesla employees who had worked at the Home Depot displays would be allowed to move to Tesla's stores. Tesla bought the solar installation company SolarCity in 2016 for $2.6 billion. At the time, some criticized the acquisition as a bailout of a business operated by two of Musk's cousins, Peter and Lyndon Rive. Musk was the chairman of SolarCity's board of directors before Tesla purchased the company. Tesla makes and sells solar panels, a home battery, and solar roof tiles that resemble traditional roof tiles. In its first-quarter earnings report this year, Tesla said it made a record number of installations and increased the backlog of orders for its Powerwall home batteries. The company said solar panel installations have decreased in recent quarters due to a shift in its strategy, which has included a move away from the door-to-door sales model SolarCity used before it was acquired. If you've worked for Tesla and have a story to share, you can contact this reporter at mmatousek@businessinsider.com.