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SpaceX asked California for $655,500 in job funding. The answer: No

SpaceX and Tesla CEO Elon Musk, shown in March, reopened Tesla's California factory in the face of coronavirus shutdown orders and has threatened to move the automaker's headquarters out of state.
SpaceX and Tesla CEO Elon Musk, shown in March, reopened Tesla’s California factory in the face of coronavirus shutdown orders and has threatened to move the automaker’s headquarters out of state.
(Susan Walsh / Associated Press)

A California employment panel rejected a funding request from Elon Musk’s SpaceX on Friday after the aerospace firm’s billionaire founder defied a San Francisco Bay Area health order and threatened to move the headquarters of his electric car company, Tesla Inc., out of the state.

The state’s main union federation and other labor officials wrote to California’s Employee Training Panel on Thursday to voice opposition to the $655,500 that Hawthorne-based Space Exploration Technologies Corp. sought to train existing workers and hire new ones. Their resistance was pivotal, as four of the eight panel members are labor leaders. Five members voted no during Friday’s virtual meeting.

Musk “has a proven track record of enriching himself and his companies instead of being a good corporate partner,” Art Pulaski, the head of the California Labor Federation, and three other labor leaders wrote to the panel Thursday.

Representatives for SpaceX didn’t respond to requests for comment.

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SpaceX reportedly raised money this year at a roughly $36-billion valuation, so the state funding isn’t pivotal to the closely held company’s future. But the denial is an early indication of blowback after a week in which Tesla sued Alameda County for resisting the carmaker’s efforts to reopen its only U.S. auto plant, in Fremont, during the stay-at-home orders meant to curb the spread of the coronavirus.

Musk also threatened to move Tesla’s operations elsewhere before tweeting that the automaker would flout local authorities and restart production. The blog Electrek reported Friday that Tesla would build its second U.S. vehicle factory in Texas.

Elon Musk has listed another five of his California homes. The tech billionaire now has seven properties for sale for a combined $137 million.

The hardball tactics seem to have worked for Tesla. Officials from Alameda County issued statements this week calling talks with the company about reopening the plant productive and then saying that it could ramp up activity.

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Musk “defies them at every turn and he gets his way again,” Rome Aloise, president of the Teamsters union’s council covering Northern California, said in an interview Wednesday. “Why should we be subsidizing him on any level — SpaceX or Tesla?”

Gretchen Newsom, one of the labor officials on the panel considering SpaceX’s request, moved to deny the motion after raising concerns about wages, job retention and turnover and Musk’s recent threats to leave the state.


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