tesla slashes solar business with plans to shut down a dozen facilities in nine states and dump home depot - residential energy storage systems

Electric vehicle maker Tesla Inc. 's 9% job cuts last week will significantly reduce its residential solar business, which was acquired two years ago for a controversial $2 deal.
According to three internal company documents and seven current and former Tesla solar employees, 6 billion of the deals were made.
Was the latest cut in SolarCity's department-
Sales and installation company created by two cousins of Tesla CEO Elon Musk-
According to the company's internal documentation, including the closure of about a dozen installation facilities, and the end of the retail collaboration with Home Depot, which currently produces about half of the sales, according to previous employees.
According to a list of internal companies reviewed by Reuters, about 60 installation facilities remain open.
An email inside the company said 14 factories were scheduled to close, but the other list included only 13 of them.
Tesla declined to comment on which sites were planned to be closed, how many employees would be out of work, or the proportion of solar employees they represented.
The company says it cuts its overall energy team-
Including batteries for storing electricity
In line with the broader layoffs of 9% people.
In a statement to Reuters, Tesla said that we continue to expect that Tesla's solar and battery business will be the same size as the car business in the long run.
Business closures that have not been reported before have raised new questions about cash viability
Tying Tesla's solar business with Musk's merger rationale, which he once called "no wisdom "--
But some investors believe that at the expense of Tesla shareholders is a bailout for an affiliate.
Prior to the merger, Musk served as chairman of the board of SolarCity.
The in-house Mail says the closed installation offices are located in California, Maryland, New Jersey, Texas, New York, New Hampshire, Connecticut, Arizona and Delaware.
According to Tesla's former employees, the company also fired dozens of solar customer service personnel at call centers in Nevada and Utah, some of whom were fired during last week's layoffs.
The employees were reluctant to be named because public comments could violate their severance pay terms.
It's been a tough few days.
A Tesla manager wrote in a separate internal email that no one could deny this, which was sent to customer service employees shortly after the layoffs were announced.
Tesla has been burning money as it tries to reach its goal of producing 5,000 Model 3 electric cars a week after production delays.
The company is under pressure from investors to make a profit without using Wall Street for additional capital.
The total number of solar Labor cuts is still unclear.
Current and former employees say some of the personnel who shut down the facility are moving to other locations.
SolarCity hired about 15,000 people at the end of 2015, but has since cut thousands of jobs.
Ending the Home Depot partnership, allowing the sale of solar energy in about 800 stores, is part of Tesla's greater effort to include SolarCity in its high-end market
End the brand and sell 90 of its $109 salesS.
Retail stores and their websites, the company said.
Tesla said that in any retail sector across the country, Tesla stores have the highest passenger traffic.
Analysts questioned Tesla's solar business plan because of the latest cuts in its workforce and retail operations.
Frank Gillett, an analyst at Forrester Research, said that in fact, they seem to be saying that we don't have a strategy to sell solar energy. He added,
In the first quarter of this year, Tesla installed a 76 MW solar system.
Lower than SolarCity's quarter of more than 200 MW in early 2016, when it was the industry's leading company.
When Tesla announced its quarterly results in February, it said it would resume growth in solar deployments later this year.
The decline in Tesla's solar sales could also jeopardize the future of a joint venture with Panasonic. In 2016, with Tesla acquiring SolarCity, the company announced that it would produce solar modules at a new factory in Buffalo. New York.
Tesla reached an agreement with New York state to spend $5 billion in 10 years.
If Tesla and other companies fail to meet this obligation, the company may be required to pay tens of millions of dollars in fines on various milestones and may lose the lease, the company told investors in a possible document, or was forced to write down the assets.
In response to a Reuters question, Tesla said it was fulfilling its commitment to hiring and spending at the plant.
A Delaware judge dismissed a lawsuit filed by Tesla shareholders over the SolarCity deal.
The lawsuit accused Tesla's board of violating its duties to shareholders by approving the merger.
SolarCity founder Lyndon River, Musk's first cousin, left Tesla last year and did not respond to requests for comment.
The move to end Home Depot's long-standing partnership caught many employees off guard as Tesla announced an expansion in February.
Austin Perea, analyst at GTM Research, estimates that this partnership has recently accounted for about half of sales, in part because Tesla had previously taken steps to cut other sales and marketing costs. Such third-
According to clean energy research, the party retail partnership is one of the most expensive means to generate solar sales, in part because retailers have to cut prices every time they sell.
According to GTM Research, the cost of winning customers through stores like Home Depot can be as high as $7,000 per system, while the national average cost per installation is $4,000.
Home Depot spokesman Stephen Holmes said the retailer's relationship with Tesla will continue until the end of this year, adding that Home Depot will continue to compete with Tesla's rival Sunrun in no quantity.
Over the past year, Tesla has stepped up sales of solar and energy storage batteries in retail stores, and Musk said last year that it is a more effective channel for demand generation.
At the same time, Tesla also stopped opening the door. to-
The former employees said door-to-door sales were once one of SolarCity's most successful means of reaching out to new customers, and that salespeople were no longer allowed to hold local events or buy online leads.
This strategy is the standard practice for most highly competitive residential solar industries.
A former employee told Reuters that Home Depot's co-operation costs are high, but it is also part of Tesla's sales of solar panels.
This is an expensive account, the former employee said, but it does bring all the revenue.