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This electric vehicle manufacturer teaches a lesson in crisis management

Major U.S. automakers have made a big shift in electric vehicles in recent years, but in terms of crisis management, the zero-emissions focus is not a pass for bad behavior. A new lawsuit against Tesla Motor Company indicates that a lack of attention to racism and labor issues can impact the brand’s reputation, regardless of what comes out of the tailpipe.

The case against Tesla

The Tesla lawsuit was widely reported last week, when the California Department of Fair Employment and Housing followed a three-year investigation into a Tesla factory in Fremont by bring a civil action against the electric vehicle maker this month. The agency also issued a press release about it.

“After receiving hundreds of worker complaints and a nearly three-year investigation, DFEH has found evidence that Tesla operates a racially segregated workplace where black workers face racial slurs and are discriminated against in job assignments. work, discipline, pay and promotion,” DFEH director Kevin Kish charged in a public statement.

DFEH also alleges that Tesla ignored those who tried to bring the situation to the company’s attention.

“In addition to racial segregation in terms of employment, DFEH alleges that Tesla turned a blind eye to years of complaints from black workers protesting the near-constant use of racial slurs in the workplace and the presence of racist writings. and graffiti in common areas of the workplace, including swastikas and other hate symbols,” the DFEH wrote.

Crisis Management 101: Failure

National Public Radio was among many news outlets that noted a history of complaints at the Fremont plant going back virtually to the start of operations in 2012, and listing some of the allegations in gruesome detail.

“The California Department of Fair Employment and Housing (DFEH) said it attempted to resolve the dispute without litigation initially, which would involve internal dispute resolution provided by the department, free of charge,” it said. reported NPR, but Tesla reportedly refused to attend a meeting offered last month.

Tesla responds to complaint by posting a public message on the company’s blog on February 9. In terms of crisis management, the strategy underlying the message seems rather strange. Tesla could have simply disputed the lawsuit’s allegations while pledging to take the matter seriously. Instead, the message is a litany of deviation, misdirection and misplaced victimization.

Who is the audience?

The strategy behind the blog post is actually not such a mystery. This is not a signal intended to calm Tesla investors and other financial players. It’s a message to Tesla fans, a set of talking points to discuss on social media, whether or not they’re relevant to the case, or factual at all.

For example, at the beginning of the article, Tesla describes itself as “the last remaining automaker in California”, implying that its unique status should give it special consideration. This obviously has nothing to do with the accusations made by the DFEH.

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Tesla also points out that the Fremont electric vehicle plant “has a majority minority workforce.” That may be the case, but the company provides no guidance as to whether or not minorities had equal representation, let alone majority representation, as executives, managers or supervisors at the time of the allegations.

Similarly, Tesla points out that it “provides the highest paying jobs in the automotive industry to more than 30,000 Californians.” Tesla does not specify whether or not the “best pay” applies to jobs at the plant where the alleged behavior took place, or factory management positions, or other high-paying positions at its headquarters. social and in other offices.

Tesla raises the job creation angle for a second time, arguing that DFEH should work with the company instead of prosecute it, “especially because the allegations focus on events from years ago.”

This argument may make sense to Tesla fans, who are ready to find any excuse for their favorite car. However, time does not erase the crime. The appeal to a timeline is just another non-sequentialunless Tesla also shows that the statute of limitations has run out on the charges.

Hyperbole on decarbonization

The blog post reaches pure hyperbole when referring to Tesla’s impact on decarbonization.

“No company has done more for sustainability or clean energy job creation than Tesla,” the company says. However, any transit company or bike manufacturer can arguably do “more for sustainability” than any premium passenger car manufacturer, zero-emission or not.

The reference to clean energy jobs is even less compelling, given the activity in the wind and solar industries in the United States generated by the Renewable Energy Buyers Association and other company-led clean energy associations.

If the clean energy argument refers to Tesla’s acquisition of residential solar installer SolarCity in 2016, it still doesn’t hold up to scrutiny. The largest solar installer in the United States is sunrun.

Doing good is not a pass

Having compiled this list of talking points, the blog post discusses the lawsuit itself. The gist of his argument is that previous DFEH investigations have not resulted in misconduct charges. However, this is a somewhat hypocritical take. Tesla refers to “nearly 50” DFEH investigations that have been closed in recent years through no fault of their own. If the number were 500, it would still have nothing to do with the allegations in this particular lawsuit.

The blog concludes by revolving around the main topic of discussion, which is the idea that a company that has “done so much good for California” shouldn’t be the target of lawsuits.

It’s true that big companies like Tesla often leverage their economic clout to win favorable results in court. Yet job creation is not a magic shield to offset crime. Tesla can easily win the hearts and minds of his fans, but convincing a court will take some work.

New options for electric vehicle buyers

Tesla will also face an additional challenge as the trial unfolds. So far, other major US automakers have failed to challenge Tesla in the electric vehicle space. In 2016, General Motors tried the all-electric Bolt, but car buyers didn’t latch on to the unfamiliar name – or other models – in large numbers.

That started to change two years ago, when Ford had instant success with an electric version of its iconic Mustang brand, followed by an all-electric version of its popular F-150 pickup truck. In the years to come, electric car buyers will be able to choose from some of the most recognizable names in American automotive history for zero-emission mobility.

Take crisis management seriously

Virtually every major company generates controversy over labor issues at some point. Tesla still has plenty of time to deal with the new competition in electric vehicles and attract car buyers outside its comfort zone, which is currently skewed. white, masculine and republican.

However, it will take real effort, and not just a set of talking points, for Tesla to maintain its status as the top maker of electric vehicles in the United States in the years to come. The Fremont plant has been a sore spot for union rights advocates, and Tesla’s anti-union stance puts the company at a disadvantage at a time when young workers are rediscover the power of unionization.

To make matters worse, the media spotlight continues to draw attention to the tax evasion habits of Tesla CEO Elon Musk. His social media habits don’t help either. Musk regularly mocks President Biden on Twitter, and he recently praised ongoing far-right protests that erupted in Ottawa and elsewhere in Canada.

If Tesla is serious about damage control, the company could start by abandoning the attempt to portray itself as a benefactor and stop undermining the commander-in-chief as the nation faces the prospect of all-out war in Europe with the threat of violent right-wing extremism in his country.

Image credit: Martin Geiger via Unsplash