Quote:
Originally Posted by Cactus Hibs
All in all the whole dance worked out to a pretty sweet deal for Tesla. They built at the site that probably made the most financial sense to them all along, but managed to get Nevada to pony up subsidies and enticements to the tune of $1.9 billion. Amazing what a little flirtation will get you...
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To be accurate, Nevada's package comes to $1.25 Billion, and it is almost all in the form of tax abatements which are performance linked. Basically they are granting Tesla (subject to legislative approval) 10 years of operations tax free. Considering that the state analysis shows $100 Billion in total economic benefit to the area over 20 years, it looks like a good deal for both sides.
Another thing to keep in mind is that Elon Musk said after the Governor's announcement that Nevada did not have the biggest financial package. But he had been saying from the beginning that the #1 decision point for site location was about time to completion. He HAS to get the plant up and running fast in order to keep up with projected auto production. A lot of people missed that point, but he's been saying it all along. And in Nevada he'll be in production before the permit process could even be completed in California, early 2017 or possibly late 2016.
Another thing a lot of people missed is that Musk said he wants a Plan B, in case Plan A runs into difficulty, so they may start construction on a second site. I think NM is in the top spot for that second slot, if Tesla pursues that plan.
Texas and Arizona, in my estimation, are out of the running because they refuse to allow Tesla's direct-sales model in their states, due to very strong franchise dealer associations and their fat campaign deductions. Would you want to make a $5 Billion investment in a state where you can't sell your products? I sure wouldn't. And California simply has too many time consuming environmental protection provisions coded into the permit process to allow for the kind of "fast-track" factory constructin that Musk insists upon.
Quote:
Originally Posted by nmguy
Another factor in Nevada's favor: it's the only state in the U.S. that has lithium mines.
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Hardly a major factor. First, there's a much bigger lithium mine in Colorado which is currently closed because the cost of production is higher than the current global commodity cost. Second, most of the current supply of lithium for battery manufacture comes from Chile, and is cheaper than domestic product. Third, production of lithium from seawater and brine lakes is already viable, and is becoming increasingly important. In the future mining may not even be a practical source.
Anyway, my point is simple... if you are an advocate for getting a Gigafactory built in new Mexico, don't give up just yet. New Mexico could still be a player.
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