Tesla breaks ground in Nevada, but still undecided on gigafactory location

Article by Christian Andrei, on August 5, 2014

Tesla Motors Inc. may have already broke ground on a site near Reno, Nevada, but it remains undecided where to located its large-scale battery facility. Aside from Nevada, Tesla is also assessing sites in California, Arizona, New Mexico and Texas.

Tesla chief executive Elon Musk remarked during the carmaker’s second-quarter earnings conference call that the construction pad required to construct the gigafactory in Nevada is essentially complete. Musk, however, said that Tesla will do similar site preparations in “one or two” other states, with a final decision up in the “next few months.”

According to Musk, Tesla is laying the groundwork to commence construction quickly once it decides which is best site and state incentive package, instead of waiting for the details to be finalized.

The carmaker is betting that long-term cost savings of a gigafactory in an ideal location with ideal incentives will offset any near-term duplicate costs of preparing sites for construction. Musk said that it makes sense to “have multiple things going in parallel.”

He remarked that before Tesla could actually start construction of the gigafactory, it needs to make sure that things are sorted out at the state level like incentives that make sense and are fair to both the state and to Tesla.

Musk underscored that offered incentives should be also fair for the state, not just for Tesla. He noted that at this point, the “ball is in the court of the governor and the state legislature.”

Tesla and Japanese battery maker Panasonic has announced that have reached an agreement to cooperate to build and run the gigafactory. Under the deal, Panasonic would install equipment and produce the next-generation lithium ion battery cells at the plant with Tesla providing and managing the land and buildings as well as assembling the cells into battery packs. [source: automotive news - sub. required]

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