Tesla has reportedly cut its solar panel prices in an attempt to slow the decline of the companies solar business. In some locations, Tesla’s prices are now 38 percent below the national average. If the solar business continues to flounder, it could have major implications for Tesla’s taxpayer-supported operations in Buffalo, New York.
The Verge reports that Elon Musk’s Tesla slashed pricing for its solar panels as it attempts to save its waning solar business. The company’s online configuration tool now shows a 4kW set of panels at a price of $7,980 with the application of a federal tax credit, in total costing $1.99 per watt with installation included.
In other locations across the U.S., prices drop to as low as $1.75 per watt, 38 percent less than the national average of $2.85 and a huge decrease in Tesla’s previous prices. Sanjay Shah, the head of Tesla’s solar business, claims that Tesla has made prices more affordable through two main methods. The first being the standardization of more installations, allowing customers to purchase panels in increments of 4kW in the form of 12-panel arrays. Secondly, customers will now be asked to perform some of the home installation themselves; customers will be asked to photograph electric meters and circuit breaker boxes and send these photos to Tesla rather than have a technician do so.
Tesla needs to make significant changes to save its solar business from recent drops in sales, which fell to its lowest level in six years in the first quarter of 2019. It was noted by the Buffalo News that Tesla deployed 47 megawatts in the first quarter, in comparison the company deployed 73 megawatts in the first quarter of 2018. Tesla has dropped to third place in terms of U.S. solar installations as a result, falling behind Sunrun and Vivint Solar.
Shah expects to finally release Tesla’s solar roof tiles which have still yet to be made available to the public despite the announcement of the product in 2016. Tesla CEO Elon Musk had the tiles installed on his own home in 2017 and said during the company’s last earnings call that they are still developing and testing the roof but are facing issues with durability and a broader rollout of the product.
Breitbart News previously reported that former Tesla workers provided accounts of their time at the company’s Buffalo, New York solar production facility where they said that management showed a “lack of urgency” to fix the many issues at the facility. From Breitbart’s article in February of 2019:
One employee reportedly raised issues about this with management and was told that Tesla was trying to “build the plane as we’re trying to fly it,” and to expect many hiccups at a start-up company. Dale Witherell, one of the 50 employees laid off by Tesla recently, commented on the company’s practices saying: “I don’t know how Gigafactory II has been going on this long without any checks and balances or any government officials or politicians actually monitoring or watching and holding them to some standards.”
The Gigafactory II in was constructed and kitted out with $750 million in taxpayer funds as part of an initiative by Gov. Andrew Cuomo. According to the rules of the initiative, if Tesla doesn’t employ 1,460 workers at the facility by April 2020 the company could face $41.2 million in state penalties. Currently, the plant employs 800 workers divided between Tesla and Panasonic who both operate out of the facility. But some former workers have disputed Tesla’s employment figures.
Tesla responded to some claims by former employees stating: “As we’ve said, Solar Roof is a product that needs to last decades, and therefore has a long development cycle, and we’ve been thoughtful and deliberate as we gradually ramped production,” a spokesperson said. “We understand that job cuts like those we announced two weeks ago are never easy, and we are grateful to everyone who departed for their contributions to Tesla’s mission.”
Tesla reported a 21 percent decrease in installed solar systems for the fourth quarter which appeared to add to the lack of production at the facility. Dale Witherell and another worker, Dennis Scott, saw the slow production rate at the factory firsthand: “We’re paid for 12 hours to work, not watch movies,” Scott said. Witherell added: “During my employment there, nothing improved during the entire employment as far as production.”
Witherell continued to say: “Some weeks we produced enough solar modules for zero homes and probably the best I saw was maybe four homes in a week, so that is alarmingly scary to obviously be a part of a company who doesn’t have any sense of urgency to tackle these issues and get them working correctly.” Scott himself questioned the decision to invest $750 million into the firm saying: “That $750 million could have been spread out a lot better to a lot of other companies to stay here in Buffalo than sinking it into one big company.”
Read the full report here.