Tesla’s (TSLA) aims to ramp up production of its electric vehicles in Germany may be at risk because of a serious industrial relations spat over…health bars and socks.
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Heavy Metall
It has been reported in Tesla circles that although the company’s Giga Berlin factory is at full capacity, labor relations have become strained.
According to German outlet Handelsblatt, the IG Metall union is currently in dispute with the Musk-led outfit over the company’s bonus system, gifts for employees and rather more strangely health bars that were distributed to workers.
Apparently, the union is urging Tesla to give bonuses to all employees, not just those who have 100% attendance, but is also upset that the red Tesla socks emblazoned with a “Giga” logo and distributed to all employees last year were inadequate.
What then of the health bars? Well, it appears that muesli bars were wrapped in a blue packaging. That was criticized by IG, which is apparently known as the red group in the works council. Blue, it seems, is more associated with management.
If only Karl Marx knew!
Worker Woe
Employee relations, of course, are no joke for any business, particularly one operating on foreign soil and trying to adapt to local working culture and customs. It is why production is such a key risk for Tesla and investors – see below:
Tesla has had its issues with employment rights before. Back in June, Swedish pension fund AP7 revealed that it had blacklisted the stock “due to verified violations of labor rights in the United States.”
Indeed in 2023, Tesla supervisors at a Florida service center violated U.S. labor law by telling employees not to discuss pay and other working conditions or bring complaints to higher-level managers.
Last year, the National Labor Relations Board accused Tesla of taking steps to keep employees in Buffalo, New York, from unionizing.
The German grumbles come as Tesla is reportedly preparing to ramp up production at its Berlin Gigafactory after strong sales momentum. According to Germany’s DPA news agency, plant manager André Thierig said the facility will exceed its earlier EV output targets and has raised its production targets for the third and fourth quarters.
Is TSLA a Good Stock to Buy Now?
On TipRanks, TSLA has a Hold consensus based on 15 Buy, 12 Hold and 8 Sell ratings. Its highest price target is $548. TSLA stock’s consensus price target is $323.94, implying a 23.62% downside.
