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Tesla Shares Fall as New Workplace Investigation Revealed

Customers Wait In Line To Reserve Tesla Motors Inc. Model 3 Ahead Of Store OpeningsCustomers Wait In Line To Reserve Tesla Motors Inc. Model 3 Ahead Of Store Openings
The Tesla Motors Inc. store stands on the Third Street Promenade in Santa Monica, CaliforniaPatrick T. Fallon/Bloomberg via Getty Images

The California Division of Occupational Safety and Health is investigating the injury of a subcontractor who broke his jaw while working at Tesla’s Fremont, Calif. factory, the second probe opened by the agency this month to examine hazards at the company.

News of the investigation, which was first reported by Bloomberg, alongside a J.P. Morgan analyst note that forecasts headwinds for Tesla as German luxury brands launch their own electric vehicles, sent shares down more than 2% Friday.

CAL-OSHA opened an investigation on Apr. 18 into workplace hazards at the factory just days after the Center for Investigative Reporting’s Reveal published a lengthy report about worker safety at Tesla’s Fremont factory, where the Model S sedan, Model X SUV, and new mass-market Model 3 is produced. The report uncovered evidence that Tesla had underreported worker injuries to regulators.
News of a second investigation, which was actually launched the week before on Apr. 12, involves a specific workplace incident when a worker employed by subcontractor Automatic Systems reportedly broke his jaw when he was hit by a skid carrier at Tesla’s factory. The multi-employer accident investigation will focus on the Kansas City, Missouri-based subcontractor and with Tesla.
CAL-OSHA told Fortune it was notified April 10 of a serious injury suffered the previous morning by a millwright employed by Automatic Systems. The worker, a 30-year-old man, was struck by a skid carrier and was transported to the San Jose Regional Hospital with a broken jaw and laceration to the face.
Cal/OSHA said it is investigating the cause of the incident and has six months to issue citations for any violations of workplace safety regulations.

Tesla confirmed there was an accident and issued a statement noting that the worker was a subcontractor working under a primary contractor when the accident occurred.

“Nothing is more important to us than the safety and wellbeing of those who work at Tesla every day. This injury involved a worker who had been hired by an independent contractor and was performing a procedure that had been developed by and was under the supervision of that contractor,” a Tesla spokeswoman wrote in an emailed statement. “This contractor was also responsible for reporting the injury, which they did. We take any injury very seriously, and we’ll of course provide our full cooperation to Cal-OSHA. Last year alone, while Tesla’s vehicle production increased 20%, both our rate of injuries and the average severity of injuries declined significantly – and we’re working hard to reduce that even more.”