Tesla Motors has announced it will locate its ‘Gigafactory’ battery factory in Nevada.
The plant is to be located in an industrial park in Storey County, about 15 miles (25km) east of Reno, an area that currently has a population of around 4,000, the BBC reported.
“This is great news for Nevada. Tesla will build the world’s largest and most advanced battery factory in Nevada which means nearly US$100bn in economic impact to the silver state over the next 20 years,” governor Brian Sandoval said in a statement issued by Tesla.
According to the Wall Street Journal, Nevada’s state legislature will seek to approve a bill that will allow Tesla to receive between $750m and $1bn in tax abatements and $195m in tax credits. The state expects, however, that over 20 years the plant still will generate $1.9bn in tax revenue.
The WSJ cited Nevada assembly speaker Marilyn Kirkpatrick as saying she had given the plan initial support and looked forward to receiving more information so the legislature can meet and take necessary action. The governor said the average wage at the plant would be $25 per hour.
“This is a significant opportunity to make a major stride to improve our statewide economy,” he added.
In Teslas’s statement, chairman and CEO Elon Musk said: “The Gigafactory is an important step in advancing the cause of sustainable transportation and will enable the mass production of compelling electric vehicles for decades to come. Together with Panasonic and other partners, we look forward to realising the full potential of this project.”
The WSJ said the plant green light is an opportunity to expand its manufacturing employment base and diversify an economy largely built on tourism. Manufacturing represents less than 4% of the workforce in the state, compared with the dominant leisure and hospitality industry, which is more than 25%, the report said, citing the US Bureau of Labor Statistics.
“Tesla coming here is going to have a big impact,” Marc Johnson, an economist and the president of the University of Nevada, told the Wall Street Journal.
“We have had a relatively high unemployment rate through the downturn. It will be a technical push ahead for a community that has been a gaming or tourism community.”
The WSJ noted the decision came after months of discussions between Tesla and Nevada officials.
Since early this year, Tesla had been scouting sites in Arizona, California, Nevada, New Mexico and Texas, and had set off a competition between the states to come up with incentive packages that could total 10% of the project cost or about $500m.
There have been numerous media and social media reports of a a clandestine construction site in Nevada with heavy security, tight-lipped workers coming and going and little official confirmation of what was going on. Some reports suggested groundbreaking had begun at several sites in an effort to speed factory construction work whichever site was finally given the nod.
Musk told the WSJ the proposed battery factory was “critical to our efforts to deliver our mass-market car”, the forthcoming Model 3, which would start at $35,000 and travel 200 miles on an electric charge.
Musk said the decision between Nevada and other states was “tight” but, in the end, its ability to move quickly to allow Tesla to set up the factory in under three years was critical. He said the plant would be energy self-sufficient, using geothermal, wind and sun to provide electricity.