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Tesla Looks to Nevada for New Plant


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The car company Tesla looks to have finally made the decision of where the proposed 5 billion dollar Gigafactory which has become a 5 state competition has had its location finally selected. According to CEO and founder Elon Musk, Tesla had already broken ground at a site in Nevada in July but was keeping their options open for a possible factory in New Mexico, Texas, California and Arizona. The construction of this factory would allow Tesla to realize a goal of mass producing its batteries for industrial and commercial sales as well as the ability to produce other models for the car manufacturer.

Why Nevada?tesla 1

Nevada has promised Tesla the opportunity to produce their batteries and any future vehicles with legislation that could offer the company upwards of 400 million dollars in tax incentives. Such a discount in tax incentives would require Nevada’s state senate to enact legislative changes but as state representatives stated, they would be a huge plus for the area and the state itself. Tesla had already announced in the early part of the year of its plans to create a new crossover model which the company is looking to sell at around 30,000 to 40,000 dollars and appeal to a much wider segment of the market. The company has already confirmed that they have been actively excavating at a site just outside of Reno at an industrial park. The amount of land the company has announced would require a 10 million square foot factory that would be able to produce up to 500,000 battery packs per year by the year 2020. The new gigafactory is proposed to cost the company between 4 and 5 billion dollars and would more than double the output capability by Tesla. The factory itself has been suggested to be the sole plant that would produce the batteries that fuel Tesla’s cars. These batteries would also be manufactured for commercial applications as well, as previously Musk had stated the uses of the batteries would be more economical than traditional modes of gasoline or diesel powered equipment. The new plant has become one of the most sought after plants in recent history among the 5 states that were competing for Tesla’s investment. What has been coined as one of the most lucrative state economic stimulus plans by a private investing company would employ a whopping 6,500 people if the plant were to run at full capacity. Tesla’s new factory would then only be a stone’s throw away from their main production facility in Fremont, California. Nevada has the infrastructure already set up which have helped in creating the state to be the ideal destination for the gigafactory. With air transportation in the area, rail lines and the closeness to the main production facility as well as the headquarters for the company have only strengthened the vision of Elon Musk. The most important feature is that the company has already announced that the state that would take on the new factory would have to provide about 500 million dollars towards the overall price of the plant, or about 10 percent of the overall cost which is not unheard of in economic development plans.

Tesla’s Current Model Stesla 2

The current model in production is the Tesla Model S which is most comparable to the more premium of luxury sedans. The car ranges from roughly 75,000 dollars to about 95,000 dollars before any kind of government purchase incentives and is fueled by a lithium ion battery. Tesla cars have made industry headway in the last couple of years as electric cars have taken on more of a premium face rather than many of the hybrid sister cars that have been marketed towards the general population. Musk made history a couple o months ago when he announced the company was setting itself up to share its electric vehicle patens with the other car manufacturers in an effort to push the technology and make it more available to the customers. In the spirit of the movement, Musk has been quoted as saying that even if it’s not a Tesla in someone’s driveway, the electric car movement is the way to go. Musk has recently denounced the hybrid movement and the fuel cell technology being developed by Hyundai and Toyota. Tesla is very excited about the Model III which will be the third vehicle to come off of the Tesla assembly lines, aimed at the mass market. About a year ago the company had been playing with a Model X in which they had wanted to make available to the public by mid 2017 but the company has retracted their cost estimate as current projections will place the crossover into the more expensive market like its sister car, the Model S.

The victory for Nevada might come with a price tag but it is the belief of the governor and the state senate that such a hefty economic investor like the Tesla Motor Corp. brings along both economic and job development. At the end of the day there are two clear winners, the company which has been given the opportunity to grow and those that are being put to work via a new plant.

 

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