Last week, Tesla announced it would lay off 9 percent of its workforce in an effort to keep its doors open as it tries to ramp up production of its critical Model 3 electric car.
Now internal emails obtained by Reuters show that 13 or 14 of Solar City’s installation centers will be shuttered as part of the layoffs. About 60 centers will stay open.
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Tesla had previously announced that it would end Solar City’s partnership with Home Depot, which accounted for about half of the company’s sales.
Tesla acquired Solar City in 2016 in a $2.6 billion deal to complement its Powerwall stationary battery business. CEO Elon Musk served on the board of Solar City, which was founded by two of his cousins.
Tesla Solar Roof
In January, the Trump Administration slapped a 30 percent tariff on imported solar panels, which mainly come from China. The move is expected to increase the cost of residential solar installations, one of Solar City’s main businesses, by $500 to $1,000 in 2018. Two of Solar City’s largest panel suppliers are based in China, although the company plans to open a new factory in Buffalo, New York to build its own panels.
The closing locations are in nine states, including Arizona, California, Connecticut, Delaware, Maryland, New Hampshire, New Jersey, New York, and Texas.
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Tesla said that layoffs on its “energy team,” including Powerwall batteries and Solar City, are in line with its broader 9 percent staff cut. In a statement to Reuters, the company said, “We continue to expect that Tesla’s solar and battery business will be the same size as automotive over the long term.”
The company first revealed that it would have to cut its staff at its annual meeting June 5, and followed last week with the specific cuts. It said most of the layoffs would come from executive ranks and none from production lines that could impact the rollout of the Model 3.
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