LOS ANGELES/SAN FRANCISCO, June 24 (Reuters): Electric car maker Tesla Inc's move last week to cut 9.0 per cent of its workforce will sharply downsize the residential solar business.
It bought the business two years ago in a controversial $2.6 billion deal, according to three internal company documents and seven current and former Tesla solar employees.
The latest cuts to the division that was once SolarCity - a sales and installation company founded by two cousins of Tesla CEO Elon Musk - include closing about a dozen installation facilities, according to internal company documents, and ending a retail partnership with Home Depot Inc that the current and former employees said generated about half of its sales.
About 60 installation facilities remain open, according to an internal company list reviewed by Reuters. An internal company email named 14 facilities slated for closure, but the other list included only 13 of those locations.
Tesla declined to comment on which sites it planned to shut down, how many employees would lose their jobs or what per centage of the solar workforce they represent.
The company said that cuts to its overall energy team - including batteries to store power - were in line with the broader 9 per cent staff cut.
"We continue to expect that Tesla's solar and battery business will be the same size as automotive over the long term," the company said in a statement to Reuters.
The operational closures, which have not been previously reported, raise new questions about the viability of cash-strapped Tesla's solar business and Musk's rationale for a merger he once called a "no brainer" - but some investors have panned as a bailout of an affiliated firm at the expense of Tesla shareholders.
Elon Musk, Chairman of SolarCity and CEO of Tesla Motors, speaking at SolarCity's Inside Energy Summit in Manhattan, New York recently — Reuters
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