Tesla Motors Inc has had an incredible effect on the world since it first started selling the Model S in 2012, but its work hasn’t always brought positives into the lives of others. This morning 1,300 people were laid off from their jobs in Beijing, China as Elon Musk’s firm convinces Panasonic to follow the money in Li-ion tech.
The Japanese battery maker said on Thursday that it would stop making power cells at the factory this month. The firm wants to focus on li-ion products with higher margins, such as the cells found in the Tesla Motors Model S and other EVs. The plant produced cells for feature phones and digital cameras, demand for which was falling in the face of the smartphone market.
Tesla Motors Inc drives battery change
It’s not clear if the plant, or the simpler battery business, was losing money for Panasonic. What was clear, from the firm’s statement on the closure, was that it wanted to shift focus from that kind of production. Yayoi Watanabe, speaking on behalf of the firm, said “The global market for these products has been shrinking.”
The firm was quick to argue that the closure was not linked to the recent problems in the Chinese economy. The move had much more to do with the direction the global battery business is going in in the wake of disruption on two fronts.
Apple and Tesla Motors have changed what batteries are for, and the Beijing operation, which was built by Sanyo to serve Nokia, was not keeping up with the times.
Panasonic said, directly, that its reason for closing the plant are based in its long term plan to put its battery production in line with the needs of Tesla Motors , and the future of the market.
Tesla Motors gets people fired
This probably isn’t the first time that Tesla Motors and Elon Musk have gotten someone fired, and it’s likely it won’t be the last. Panasonic’s Beijing operation could not keep up with the world at large. If Elon Musk has his way a lot more people are going to lose their jobs in the coming years for just that reason.
The Gigafactory will be the largest battery factory in the world, and it will take business from plants all over the globe already supplying things like home energy storage. The Tesla Motors Model S, if Adam Jonas of Morgan Stanley is right, will soon put taxi drivers in many countries out of business.
That’s the price of progress. If Tesla Motors didn’t do it somebody else would have. The firm is trying to make the world a better place. You can’t make an omelet, and all the rest.
The reality is that as the world changes with new tech, a lot of jobs are going to be made obsolete. anti-luddites might be right in saying that we’ll find new, better jobs for those people to do. The more fearful seem to think that massive unemployment is on the way and the only solution is a negative income tax.
Panasonic says it fired those people because it wants to focus on Tesla. This may be a problem that Elon Musk won’t ever want to address, but it’s a big part of the effect that Tesla Motors is having on the world and will have going forward.