Tesla disputes report of $25-an-hour pay

Tesla Motors is disputing reports that it plans to pay an average hourly wage of $25 at its huge battery factory under construction near Reno, Nev.

Tesla said it has never stated what it would pay battery plant workers. Spokeswoman Khobi Brooklyn said in an email that the company won't comment on what it will pay.

"We did submit an application to the state of Nevada last October which included projections of average hourly wage costs for its operational workforce that were informed by regional wage trends," Brooklyn said.

An average of $25 would be higher than nearly all automakers in the U.S. are paying new hires and nearly double what most parts suppliers pay. It's also above the $17 starting hourly wage of Tesla workers who assemble its Model S sedan in Fremont, Calif., near San Jose.

Tesla is building a massive battery plant called the Gigafactory in the desert east of Reno, and is planning to hire 6,500 workers over the next eight years.

Mike Kazmierski, CEO of the Economic Development Authority of Western Nevada, told the Reno Gazette Journal three days ago that the $25 per hour average was driving up what existing and new employers in the area are paying.

"Three years ago, a support call center paid $10, $11, $12 an hour," Kazmierski said. "We're basically saying, if you're not paying $12 to $15 an hour, you probably will go somewhere else. That's part of the reason why we talk retention of workforce as a priority for us."

Last October, the Reno newspaper reported, citing that application that the majority (4,750) of Gigafactory will start at $22.79, while about 820 equipment and quality technicians will start at $27.88 an hour. Engineers and senior staff will be paid $41.83 per hour.

Several labor experts said Monday they were surprised by the level of Tesla's wages in Nevada, but cautioned that they probably won't have much impact on the UAW's negotiations with the Detroit 3 automakers this fall.

Under the 2011 UAW contract, newly hired workers begin at $15.78 an hour. But that is augmented by profit-sharing that added $6,900 before taxes to most Ford hourly workers and $9,000 to most General Motors production workers.

"The battery is key to the future of Tesla as a mass market producer," said Harley Shaiken, a professor and labor economist at the University of California Berkeley. "On one hand they want to attract the best and the brightest, but on the other we don't know what the benefits are."

Shaiken added that the relatively high pay scale may be designed as a strategy to make it harder for any union to organize the workers. Tesla's assembly workers in Fremont don't belong to a union.

Kristin Dziczek, director of the labor and industry group at the Center for Automotive Research in Ann Arbor, said the Tesla pay scale probably won't cause any short-term raises among the Detroit 3 or its suppliers.

But she noted that Tesla is paying considerably more than LG Chem, which makes lithium-ion batteries in Holland, Michigan, for the Chevrolet Volt and GM workers who assemble those batteries into packs at a plant in Brownstown Township.

Contact Greg Gardner: (313) 222-8762 or ggardner@freepress.com. Follow him on Twitter @GregGardner12