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[titiklabingapat]

I have a good friend that used to work at Tesla. He was one of the top execs. He said it was hell working for them so he quit.

 

[felipeko]

Yes, it's the billionaire who is the victim.

How can you even type this out and post it?

Yes, that is exactly what i said. Let's hope no one ever work its ass off to build a better world and get rich in the process, internet people will get angry at them because of it.

 

[TarpitCarnivore]

So a bit surprised NeoGaf hasn't done there research a bit more. The first allegations of high injury rates was reported like a year ago and the information being used by the Union is from the end of 2015.....more than a year and 7 months ago. Elon and Tesla have stated that they have been addressing the issues. Pretty hilarious reading through the response of outrage while ignoring that it's old data and that the company has spoken about the issues. You would think people would wait until the numbers for 2016 or 2017 are out.

Another thing people are failing to do their research on is the pay. Tesla has repeatedly said that the workers are awarded shares that vest over time.....like almost every major company, especially in tech does. The awarded shares can easily match the yearly salary of a worker and Elon has stated that Tesla factory workers are the highest compensated workers in the auto industry. The Union is obviously trying to mislead and leave out information. I work in the tech field, your salary tells only half the story. The other half is yearly bonuses and stock awards.

I think someone mentioned something about Elon being a billionaire and not caring about his employees, their pay, or the health of the company. Elon is a billionaire in theory with his stock, not cash. In fact, he continually holds his Tesla stock without selling and continually goes into private debt to buy more shares when Tesla does a stock offering. Elon is the exact opposite of a typical billionaire. There's no doubt that Elon is a workaholic and expects a lot from his workers. But he's in there with them, spending days and nights at the factory. How many other CEO and billionaire care that much?

Also Tesla doomed to run out of cash in 3 months....3 quarters, it's all pretty silly. Try and do a bit of research before you start spouting information. Tesla has a pretty low share count right now and a very high stock price. They can raise money whenever they want or take on debt like they did recently at low interest.

You don't have to be a Tesla or Elon fanatic just because you call bullshit when you see it. Like a couple people pointed out, the Union has a vested interest here with a company that's expected to see rapid growth in the future. They're trying to make a case and are obviously going to promote their propaganda. Also not all Unions are bad. Auto Unions have been and continue to be terrible for their members and gave the terms "Unions" a bad name.

Stock should not be viewed as a good form of pay. Very very often the stock options are not to the benefit of the worker, especially a factory worker, and are nothing more than a retention tactic.

 

[Dreams-Visions]

Union up.

 

[bender_84]

Stock should not be viewed as a good form of pay. Very very often the stock options are not to the benefit of the worker, especially a factory worker, and are nothing more than a retention tactic.

We can agree to disagree because I see no way stock awards are not a adequate form of pay. For Tesla employees, stock awards are very beneficial. A worker that got stock awarded to them 3 years ago now has triple the value. Their hard work is directly affecting the value of their stock awards. Sure stock awards are about retaining talent and that's fine. It doesn't change the fact that Tesla factor workers on a yearly basis are compensated more than any other factor workers in the auto industry.

 

[low-G]

What does this have to do with the thread? They're far below the manufacturing standards set by the rest of the industry. They can make ripples in the industry without mistreating their employees.

Point is to make an omelette, ya gotta break a few eggs.

Imagine what we could achieve with even harder work, eliminate the freedom of family or returning to home, or escaping to a different employer! That's the capitalistic dream!

 

[jellies_two]

Something wrong with the system if the vast majority of employees of the one of the most successful stock market tickers make just 18 bucks an hour, 20% less than a dinosaur Ford truck plant.

The rank and file at google or Apple or Netflix I am sure make way more than they would working at the competition.

If musk says that he is struggling to survive then why are the stock holders and top management with huge stock incentives making bank?

According to glass door the stock program is employees can purchase stock at a discount with up to 15% of their pay then roll the dice. For someone working the line this is much more difficult than a design engineer on 200k that can drop 30k of his pay into stock purchases that are $4500 cheaper than market price.

 

[bender_84]

Something wrong with the system if the vast majority of employees of the one of the most successful stock market tickers make just 18 bucks an hour, 20% less than a dinosaur Ford truck plant.

The rank and file at google or Apple or Netflix I am sure make way more than they would working at the competition.

If musk says that he is struggling to survive then why are the stock holders and top management with huge stock incentives making bank?

According to glass door the stock program is employees can purchase stock at a discount with up to 15% of their pay then roll the dice. For someone working the line this is much more difficult than a design engineer on 200k that can drop 30k of his pay into stock purchases that are $4500 cheaper than market price.

You're confusing ESSP(Employee Stock Purchase Plan) with Stock Awards. They're two completely different things. Tesla employees get stock awards, even their factory workers.

 

[fauxtrot]

We can agree to disagree because I see no way stock awards are not a adequate form of pay. For Tesla employees, stock awards are very beneficial. A worker that got stock awarded to them 3 years ago now has triple the value. Their hard work is directly affecting the value of their stock awards. Sure stock awards are about retaining talent and that's fine. It doesn't change the fact that Tesla factor workers on a yearly basis are compensated more than any other factor workers in the auto industry.

Tell that to the Tesla factory worker that is trying to make ends meet @ $18/hr. Stock awards aren't going to put food on their table this month or make their mortgage/rent payment... like you said, that person has to hold onto that stock for years to ever have the potential to profit off of it in any real way. It's great for already well-paid workers, but here it is basically being used as an excuse to underpay their "expendable" middle-class employees. Why not pay competitive wages and offer stock awards so folks that get in on the ground floor and work their asses off to meet the deadlines Musk decided on can benefit from it in the future?

 

[darscot]

Tell that to the Tesla factory worker that is trying to make ends meet @ $18/hr. Stock awards aren't going to put food on their table this month or make their mortgage/rent payment... like you said, that person has to hold onto that stock for years to ever have the potential to profit off of it in any real way. It's great for already well-paid workers, but here it is basically being used as an excuse to underpay their "expendable" middle-class employees. Why not pay competitive wages and offer stock awards so folks that get in on the ground floor and work their asses off to meet the deadlines Musk decided on can benefit from it in the future?

So you have all the details of the period before those stock awards vest? It sounds like your just making stuff up.

 

[bender_84]

Tell that to the Tesla factory worker that is trying to make ends meet @ $18/hr. Stock awards aren't going to put food on their table this month or make their late mortgage/rent payment... like you said, that person has to hold onto that stock for years to ever have the potential to profit off of it in any real way. It's great for already well-paid workers, but here it is basically being used as an excuse to underpay middle-class ones. Why not pay competitive wages and offer stock awards so folks that get in on the ground floor can benefit from it in the future?

Huh? That workers' stock awards vest annually. It's doesn't work like you get awarded 50k in stock but don't get any of it until 4 years. It vest a portion of the total stock award on a yearly basis and when it vest, the employee can sell it right away if they want. Say you get 40k in a stock award when an employee starts. That 40k will vest over 4 years, 10k worth of stock "vests" every year. When the stock vests, the employee can chose to sell it right away. That's how practically every big company on the west coast handles stock awards. Again, the yearly "Take-Home" is higher than most auto factory workers.

I'm sure some people would want just straight cash pay, I get that. But the reality is that for a startup company that reinvest everything it brings, it has to offer total compensation this way. The company straight up can't afford to pay all of their compensation in cash. These employees know this when the agree to the job offer. They know that they'll get a monthly wage 18/hour and then at some point in the year, a portion of their stock award will vest and that they can cash that out. If they're having issues paying their monthly bills then they obviously did not budget their expenses correctly, that's not Tesla's fault.

 

[Catdaddy]

Starting wage that low and in the Bay Area. Most auto plants are in places with much lower cost of living

 

[fauxtrot]

Huh? That workers' stock awards vest annually. It's doesn't work like you get awarded 50k in stock but don't get any of it until 4 years. It vest a portion of the total stock award on a yearly basis and when it vest, the employee can sell it right away if they want. Say you get 40k in a stock award when an employee starts. That 40k will vest over 4 years, 10k worth of stock "vests" every year. When the stock vests, the employee can chose to sell it right away. That's how practically every big company on the west coast handles stock awards. Again, the yearly "Take-Home" is higher than most auto factory workers.

I'm sure some people would want just straight cash pay, I get that. But the reality is that for a startup company that reinvest everything it brings, it has to offer total compensation this way. The company straight up can't afford to pay all of their compensation in cash. These employees know this when the agree to the job offer. They know that they'll get a monthly wage 18/hour and then at some point in the year, a portion of their stock award will vest and that they can cash that out. If they're having issues paying their monthly bills then they obviously did not budget their expenses correctly, that's not Tesla's fault.

I get that, my point is that someone who is making $18/hr can't always wait for that stock to vest yearly when they are living month-to-month and trying to stretch their paychecks. Those that don't need to immediately cash-out (the employees well off or lucky enough not to need to do so) are going to benefit far more than those struggling as well. Part of the idea of stock awards is that saving it will net you more money long term, but not everyone has the luxury to do so.

I'm not even going to get into the "it's the workers' choice to take a low paying job in a high cost-of-living area" and "maybe they just need to budget better" mentality...

 

[bender_84]

I get that, my point is that someone who is making $18/hr can't always wait for that stock to vest yearly when they are living month-to-month and trying to stretch their paychecks. Those that don't need to immediately cash-out (the employees well off or lucky enough not to need to do so) are going to benefit far more than those struggling as well. Part of the idea of stock awards is that saving it will net you more money long term, but not everyone has the luxury to do so.

Yup that's true and it's tough in an area like California. I wouldn't argue against that. But from my point of view.....The workers agreed to this compensation plan and in all honesty, it's the only compensation plan Tesla can afford right now. It's not like Tesla changed their compensation plan and now employees are being left out in the cold. At some point you have to put the responsibility on the individual because they willingly agreed to that compensation structure.

I would have a completely different view if Telsa was offering that kind of compensation plan while they gave their executives high cash bonues and a salaries, but that's not the case here. I do hope that in the future Telsa can make the monthly take home pay higher if they are going to continue growing in a expensive areas such as Cali. This is actually very reminiscent of Amazon's early days. They had to offer stock as the main compensation and they were know for paying a dirt salary. Eventually they were able to grow enough to where the cash burn was feasibly while offering higher salaries and cash bonuses.

 

[jellies_two]

You're confusing ESSP(Employee Stock Purchase Plan) with Stock Awards. They're two completely different things. Tesla employees get stock awards, even their factory workers.

can they sell the (volatile) stock immediately if they want?
What does that take their hourly effective wage to?

 

[darscot]

can they sell the (volatile) stock immediately if they want?
What does that take their hourly effective wage to?

Stock typically vests on an anuall basis over a few years. So a 9K award you would get 3K a year over 3 years. If you get that same award every year, you get 3K the first you then 6K the next year then 9K etc. If you lucky and the company does well the stock rises and you can really do well.

 

[jellies_two]

it's the only compensation plan Tesla can afford right now..

Now this is what i don't get.

The company is valued by shareholders at 53 billion dollars. It has made an absolute fortune for investors since it was listed. It has 17,000 employees who if they got an extra 5 bucks an hour would increase expenses by $34 million.

Their quarterly expenses are 2.9 billion. 34 million is 0.25% of that (annualised).

If their expenses were a quarter of a percentage point higher than current their stock price would collapse? really?

the priorities are wrong.

 

[bender_84]

can they sell the (volatile) stock immediately if they want?
What does that take their hourly effective wage to?

So every companies stock award plan varies to some degree. The company I work for has a plan where any stock award, whether its' signing bonus or annual review stock award, vest over a 5 year cycle. So like when I first started, I got 20% of my signing stock award every year for 5 years. When I got my 20% each year, I could sell my share immediately(I really should have held on to all of my shares, DOH) My wife is at Amazon and they structure it where her signing bonus is 10% first year, 10% 2nd year, 40%, 3rd, and 40% 4th year. I think they do their annual review stock awards a similar way. So there's variation on the schedule of when your stock vests. Someone mentioned earlier that it's a retention tactic which it absolutely is. In places like Cali and in Seattle, it's very often that employees jump from company to company every year or 2 to get higher and higher salaries and signing bonuses.

Usually the only time you can't sell your shares immediately when you receive stock is when you have stock options. So say you worked for a private company, you were eligible to buy the stock options for 1,000 shares of your company that is going IPO next year. Once your company goes public, you might have to wait 6 months or a year before you're allowed to sell all of your shares.

 

[fauxtrot]

Now this is what i don't get.

The company is valued by shareholders at 53 billion dollars. It has made an absolute fortune for investors since it was listed. It has 17,000 employees who if they got an extra 5 bucks an hour would increase expenses by $34 million.

Their quarterly expenses are 2.9 billion. 34 million is 0.25% of that (annualised).

If their expenses were a quarter of a percentage point higher than current their stock price would collapse? really?

the priorities are wrong.

I also wonder how much the price per Model 3 would need to increase to more fairly compensate the portion of their workforce that is underpaid. I honestly have a hard time imagining that all of the folks champing at the bit to get their pre-ordered Model 3 would have passed on the car entirely if its base price was $37,500 instead of $35,000.

Spoiler

Yes I pulled that amount out of my ass, I'm not going to try to crunch numbers for a GAF thread

 

[bender_84]

Now this is what i don't get.

The company is valued by shareholders at 53 billion dollars. It has made an absolute fortune for investors since it was listed. It has 17,000 employees who if they got an extra 5 bucks an hour would increase expenses by $34 million.

Their quarterly expenses are 2.9 billion. 34 million is 0.25% of that (annualised).

If their expenses were a quarter of a percentage point higher than current their stock price would collapse? really?

the priorities are wrong.

So the numbers I got were pretty different. If they were to give every employee a $5 hourly raise, at 17,000 employees, that's 47 million.....per quarter and 190 million a year. Tesla is planning on hiring...a lot over the next year. Even if we take your number of 34 million per quarter, that's 136 million which is actually a pretty big number for them. That's a big hit on their cash flow at this stage in the business. Literally every dollar they are brining in goes towards expansion. That 136 million could go to R & D, Tesla superchargers, opening up new stores, etc... All of that matters. If anything look at Amazon. They did the same strategy and look where it's gotten them.

The market cap on the company really has nothing to do with the actual numbers of the company. Market cap is always about future potential(and it's often irrational) Based on traditional company metrics, Tesla should not have a 53 billion market cap.

 

[LegitMcfalls]

I work in a non union auto manufacturing factory and the rumors of unions coming in happen atleast once a year or whenever production intensifies.

The injury rate is awfully high but whenever unions are trying to get in, alot of the pro union employees will report every little injury, accident and near miss so it can be used as a negotiation point between the factory and the union.

The 18$ starting pay is low for a american factory but in canada the start for toyota/honda is 21$ canadian which is about $16.50 american. Its relativity comparable but in the Bay area I can see that being a struggle.

Alot of what Telsa is going through right now is more reflective of the change in times. The auto industry isnt what it used to be.

 

[jellies_two]

So the numbers I got were pretty different. If they were to give every employee a $5 hourly raise, at 17,000 employees, that's 47 million.....per quarter and 190 million a year. .

You are correct but it is STILL a small percentage of the loss per year, and a small percentage of the R&D budget, and a tiny percentage of the overall expenses per quarter and a few cents on the negative earning per share.

If Elon is trying to build a world class car that can be sold to everyone to improve peoples lives shouldn't he start with the 17,000 employees he can most directly and immediately effect and not mainly be about building a paper value for the company that apparently is similar to Ford (despite making a fraction of the cars per year)?

What that says is the whole story is flawed. It says that it isn't possible (yet) to make an desirable electric car at a price that people want to pay without squeezing the rank and file employees. Humans are getting treated like supply chain nuts and bolts.

 

[br3wnor]

Folks outside unions hate unions until they're in a union.

Ding ding ding. That’s the real heart of it. It’s easy to demonize Unions and convince people that aren’t in them that they suck (Union dues take up huge chunks of your paycheck! They protect bad workers! Etc.) In reality, union dues are literally a fraction of a % of your paycheck and while some bad workers are protected, it allows for protection of all the workers in a union and gives some semblance of job security.

I grew up in a union household, my dad was a construction worker in the city and his wages were double what he would have made working non-union. He had good medical benefits and is now collecting a pension. He busted his ass for 30 years, had 4 carpal tunnel surguries and both knees replaced by the age of 50 but he was able to provide a solidly lower middle class lifestyle for us and my mom (who didn’t work) thanks to his union.

I’m in a union now myself and couldn’t be happier. I pay $25 a paycheck for union dues and have an above average salary, guaranteed raises each year, good medical benefits and a pension coming to me once I clock 20 or more years. Yeah I won’t get rich doing this, but I’ll (hopefully) have a solid salary/benefits package for the rest of my working life and a nice retirement to fall back on when I hang my suit up.

Unions are a great vehicle for middle class stability in America and their demise is a huge factor in the decline of the middle class in the past 20 years.

 

[FreezeSSC]

Now this is what i don't get.

The company is valued by shareholders at 53 billion dollars. It has made an absolute fortune for investors since it was listed. It has 17,000 employees who if they got an extra 5 bucks an hour would increase expenses by $34 million.

Their quarterly expenses are 2.9 billion. 34 million is 0.25% of that (annualised).

If their expenses were a quarter of a percentage point higher than current their stock price would collapse? really?

the priorities are wrong.

Are they profitable though? From my impression they didnt actually make money yet?

 

[Harp]

So where do guys think they will built the next factory in Mexico?

 

[Slo]

This is probably an instance of a culture built around innovation and invention not working well when applied to the average factory grunt. Elon's probably not used to having to specifically spell out how many times somebody has to swing a hammer per hour in order to not be formally written up.

 

[Giant Panda]

Love Musk's projects, but I've only heard negative things about actually working at those companies.

 

[Slo]

Love Musk's projects, but I've only heard negative things about actually working at those companies.

Probably very true. Reminds me of the infamous Netflix slide deck on company culture and expectations, minus the "paying top of market" bit.

I imagine once you scale to the point where you're manufacturing cars en mass, standards have to change.

 

[LegitMcfalls]

So where do guys think they will built the next factory in Mexico?

Definitely. Its too expensive to build in USA and Canada. The only major set back would be if NAFTA gets torn up by Trump but still a cheap work force that doesnt demand a union is highly desired by the auto industry.

 

[Cybrwzrd]

Definitely. Its too expensive to build in USA and Canada. The only major set back would be if NAFTA gets torn up by Trump but still a cheap work force that doesnt demand a union is highly desired by the auto industry.

I disagree. For the class of vehicle Tesla is building, doing it in Mexico would be a huge mistake. Even with the most robust of quality systems in place, building cars in Mexico can be highly problematic. There is a reason you don't see Honda building Acuras in Celaya or Guadalajara or Toyata building Lexus in Tijuana. If Tesla ever comes out with a Fit/Yaris class car they should go to Mexico. But building a 35-60k+ vehicle in Mexico as a fledgling automotive maker that has as many manufacturing problems as Tesla has, would be nuts.

I love Mexico, and I love working in Mexico, as I go down from time to time for extended periods to advise my team down there, but it is not an easy place to do business. The biggest problem is that you can't keep people long enough to train them - and this is in both assembly positions and in the office. Also there seems to be a cultural thing about sugarcoating everything and over promising/under delivering. This can be a problem when you are told you will receive parts yesterday and in realty they will not even be ready to ship until next week...

Canada on the other hand would be a good fit for Tesla, or Northern Alabama. Or... if cheap is all they want with a high skilled and technically adapt workforce - China.

 

[LegitMcfalls]

I disagree. For the class of vehicle Tesla is building, doing it in Mexico would be a huge mistake. Even with the most robust of quality systems in place, building cars in Mexico can be highly problematic. There is a reason you don't see Honda building Acuras in Celaya or Guadalajara or Toyata building Lexus in Tijuana. If Tesla ever comes out with a Fit/Yaris class car they should. But building a 35-60k+ vehicle in Mexico as a fledgling automotive maker that has as many manufacturing problems as Tesla has, would be nuts.

I love Mexico, and I love working in Mexico, as I go down from time to time for extended periods to advise my team down there, but it is not an easy place to do business. The biggest problem is that you can't keep people long enough to train them - and this is in both assembly positions and in the office. Also there seems to be a cultural thing about sugarcoating everything and over promising/under delivering. This can be a problem when you are told you will receive parts yesterday and in realty they will not even be ready to ship until next week...

Canada on the other hand would be a good fit for Tesla, or Northern Alabama. Or... if cheap is all they want with a high skilled and technically adapt workforce - China.

I do agree that with Teslas current line up of cars Mexico wont work but eventually they will need a car like a yaris/civic and mexico seems to be the place all those models are being pushed to.