Apr 3


Report details Tesla’s solar struggles

A study conducted by an independent consultant has documented how poorly the company's solar division is performing and the long odds it faces for recovery

Tesla and state economic development officials have long treated activity at the company’s plant in South Buffalo as a state secret.

Aside from an annual report listing Tesla’s total investment and employment in Buffalo, company and state officials have been loath to clue the public in on what exactly is going on at the factory.

The lack of transparency comes despite a state investment of $959 million to build and equip the plant, on the promise it would spawn a clean energy sector in Western New York.

That’s changed with the release of a first-of-its-kind report from a global consulting firm that found Tesla’s production of its Solar Roof — the product that brought the company to Buffalo in the first place — has fallen far short of company goals.

How short?

In announcing the Solar Roof, Tesla CEO Elon Musk said 1,000 of them would be produced weekly in Buffalo and installed on houses across the country. By this point, some 169,000 Solar Roofs would have been manufactured and installed if the company had met that goal.

Instead, only 3,000 are in use.

“The analysis shows that Tesla has missed stated growth expectations,” the report notes.

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The study, produced by the energy industry consulting firm Wood Mackenzie, noted that Tesla faces stiff competition. GAF Energy, the report noted, manufactures and installs a similar residential solar product that’s beating out the Solar Roof.

“GAF Energy’s Timberline Solar roofing system is better positioned to achieve widespread adoption,” report author Max Issokson said in a statement. “The product is faster and easier to install, and the company captures customers when they are considering roof replacements.”

Issokson added that “solar roofing solutions,” including Tesla’s Solar Roof, will need to be adaptable to customer needs if the industry is to grow.

“The future potential of Tesla’s Solar Roof will rely on the company’s ability to simplify and streamline installations and tap into a broader customer base,” he said.

Recent reports from Tesla — as well as interviews with employees — indicate that instead of producing the Solar Roof at its South Buffalo plant, the company is focused on building charging equipment for its cars and inputting data to its self-driving vehicle algorithm.

Less than a quarter of the jobs involve solar manufacturing, employees recently told Investigative Post. Solar Roof production stopped altogether last year for at least six months. 

How we got here

As originally planned, the factory on South Park Avenue was going to house Silevo, a solar cell producer, and Soraa, a LED light manufacturer. Soraa pulled out and Silevo was bought by SolarCity, managed by Musk’s cousins, Lyndon and Peter Rive. At the time, SolarCity was deep in debt and losing money, posting $533 million in losses in the first half of 2016.

To convince Tesla shareholders to approve the SolarCity acquisition, Musk rushed to launch a prototype of the Solar Roof, unveiling it in October 2016. The demo worked, and Tesla shareholders approved the purchase of SolarCity by the end of the year. Tesla, along with Panasonic, began operations in Buffalo in August 2017.

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In a 2020 call with shareholders, Musk said his company would aim to produce 1,000 Solar Roofs per week. Production issues thwarted that objective, however. 

Even after solving engineering problems, employees previously told Investigative Post, Tesla management took issue with the color of the solar cells Panasonic was producing for the roof tiles. At the time, Panasonic was tasked with manufacturing Solar Roof components.

“I think the appearance was a big sticking point,” Ethan Richenberg, a former Panasonic employee, told Investigative Post recently. “They wanted these roof tiles to look uniformly black, like you have a black roof on your house. And I think the Panasonic cells, if you look at them, they’re kind of a semi-iridescent, blue-ish, green-ish color.”

By the time Tesla had set its 1,000-roofs-per-week goal, Panasonic was making plans to leave Buffalo, taking its 400 jobs to Malaysia. Instead of manufacturing Solar Roof components in-house, Tesla imported solar cells from China. 

Import restrictions — tied to federal concerns about slave labor — caused shipment delays for those solar cells, forcing Tesla to shut down Solar Roof work altogether for months at a time. 

The onset of the COVID-19 pandemic allowed Tesla to win deadline extensions from the state, giving it more time to meet its jobs goal and avoid $41.2 million in penalties. 

By the end of 2021, Tesla reported to the state that the company had brought other work to its Buffalo factory, meeting its employment goals and avoiding penalties. That included downsizing Solar Roof operations and hiring hundreds of Autopilot workers.

Production goals not met

According to the Wood Mackenzie report, the 3,000 Solar Roofs Tesla has installed is just 2 percent of the goal Musk set.

The report further estimated that with approximately 5 million new roofs built in the United States per year, Tesla’s Solar Roof “held less than 0.03% of the total roofing market in 2022.”

A spokesperson for Empire State Development, the state agency that continues to have oversight of the Tesla factory, did not address the report when contacted by Investigative Post. Rather, ESD spokesperson Pamm Lent said Tesla was complying with its investment and employment goals, the primary metrics the state holds the company accountable to.

“Tesla is reporting it has far exceeded its job and investment commitments at the Buffalo Gigafactory,” she said in a statement. “Tesla has been working to expand and diversify the facility’s operations, while also growing its manufacturing portfolio, which resulted in them meeting their 2022 obligations regarding statewide employment and cumulative investment.”

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Tesla CEO Elon Musk did not return a request for comment. Tesla disbanded its press team in 2020.

In a tweet, however, the Tesla Solar account refuted CNBC’s coverage of the Wood Mackenzie report, calling it “incorrect by a large margin.” The post did not clarify what was incorrect.

Buffalo operation has other woes

It’s not clear what will become of Tesla’s Solar Roof product.

But it is clear that the company has shifted its focus to its Autopilot division, now staffed with more than 600 employees. 

Employees in that division announced in February they were unionizing. Tesla responded just days later, firing more than 40 Autopilot employees, ostensibly for poor job performance. Tesla is currently fighting charges before the National Labor Relations related to the dismissals.

The company, in a statement, insisted the firings were due to poor performance. But current and former Tesla employees challenged that explanation, and, along with the union and its attorneys, argued the firings were in retaliation for the organizing drive.

That’s in addition to the testimony of seven current and former Black employees, who told Investigative Post they’ve been passed over for promotions, and have received racist treatment from supervisors.

At least two Equal Employment Opportunity Commission complaints are open related to the allegations of discriminatory treatment at the factory.

Investigative Post

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