Tesla Motors Inc (TSLA): Final Decision On Gigafactory In Few Months

Tesla Motors, Inc (NASDAQ:TSLA) wants to set up a factory for manufacturing its batteries and many states are contesting for the factory. While no location has been confirmed by Tesla as such, the company informed Thursday that they are preparing a site near Reno, Nevada, but the other sites are also being evaluated. Nevada has been ranking at the top among the preferred locations since June, but it still is not the chosen one and within few months it will be made clear by the company, where it wants its $5 billion factory to be located.

Final decision in few months from Tesla

Just because some ground-breaking has been done by the company in Nevada does not make it the favorite location for setting up the ‘Gigafactory’.

The new factory from Tesla Motors, Inc (NASDAQ:TSLA) will focus on manufacturing batteries for its Model 3 electric car, which will hopefully be available by 2017 for sale in the markets. California, New Mexico, Arizona and Texas are the major contenders for this factory. The so called ‘Gigafactory’ by the year 2024 would provide employment to 6500 people.

“Any potentially duplicative investments are minor compared to the revenue that could be lost if the launch of Model 3 were affected by any delays at our primary Gigafactory site,” Tesla said in a statement.

The second-quarter earnings of the company were released on Thursday after which it held a conference call where CEO Elon Musk said “at this point the ball is in the court of the governor and the state legislature.”

Intense competition among states

The states are trying hard to lure Tesla, and have come up with lucrative offers. While no such application has been put forward by the company, a building permit for Tesla factory has been pre-approved by Tucson, Arizona as per the information provided by them on Thursday.

Similar attempt has been made by California Gov. Jerry Brown around three-week back, where few tax incentives were designed to benefit Tesla that formed part of a legislation signed by him.

Tesla gigafactory will be set up with the collaboration of Panasonic Corp as informed by both of them on Thursday. While Panasonic will handle the manufacturing of batteries, Tesla will be responsible for building the said facility.