Forgot your password?
typodupeerror
Businesses Government Transportation

California In the Running For Tesla Gigafactory 172

Posted by samzenpus
from the if-you-build-it dept.
An anonymous reader writes Thanks to some clean-energy tax incentives approved late this spring, California appears to be in the running again for Tesla's "Gigafactory". From the article: "The decision should have been made by now, and ground broken, according to the company's timeline, but is on hold, allowing California, which was not in the race initially — CEO Elon Musk has called California an improbable choice, citing regulations — to throw its hat in the ring. 'In terms of viability, California has progressed. Now it's a four-plus-one race,' said Simon Sproule, Tesla's vice president of global communication and marketing, referring to the four named finalists — Texas, Arizona, New Mexico and Nevada — for the prize. That's heartening. Having the Gigafactory would be a vindication of Gov. Jerry Brown's drive to make California the home of advanced manufacturing, of which Tesla's battery technology is a prime example. With its technology, 'Tesla may be in position to disrupt industries well beyond the realm of traditional auto manufacturing. It's not just cars,' a Morgan Stanley analyst told Quartz, an online business publication last year.
This discussion has been archived. No new comments can be posted.

California In the Running For Tesla Gigafactory

Comments Filter:
  • Texas? (Score:5, Insightful)

    by cdrudge (68377) on Monday July 21, 2014 @08:24AM (#47499523) Homepage

    Why the hell is Texas in the running? I mean, it makes perfect sense to reward a state that makes it as difficult as possible [teslamotors.com] to sell a vehicle with Tesla's sales model.

    • Re:Texas? (Score:5, Insightful)

      by necro81 (917438) on Monday July 21, 2014 @08:29AM (#47499543) Journal

      I mean, it makes perfect sense to reward a state that makes it as difficult as possible to sell a vehicle with Tesla's sales model.

      It makes perfect (business) sense to locate it in a state with depressed wages, huge amounts of available land, little-to-no zoning restrictions, lax environmental regulations, and politicians that are at least a buy-able as the rest. Hell, if it's good enough for the oil and gas industry...

      • Texas! (Score:4, Insightful)

        by sycodon (149926) on Monday July 21, 2014 @08:47AM (#47499645)

        It makes perfect (business) sense to locate it in a state with reasonable wages not drive up by unreasonable taxes and regulations, huge amounts of available land, common sense zoning restrictions, reasonable environmental regulations, and politicians that are actually interested in your business becoming a success . It's what's made the oil/gas/information services/computer/auto/semiconductor/etc. industry successful so far.

        • Texas! A model for the rest of the world. Well, except for the patent trolling Marshall, TX. It's our "asshole" of the state.

        • Re: (Score:3, Insightful)

          by cayenne8 (626475)
          Yep.

          The over regulation and high taxes in CA are the killer for any business possibilities there. Large companies are leaving California due the the bad fiscal management out there and overbearing govt restrictions on businesses out there.

          You'd think at some point, sensible folks would see this and do something to curtail the problem, but when you let political philosophy outweigh what common sense should present to the current vision, you get much of what you see in CA, and more recently in the entire Fe

          • And besides, hasn't urban California decided that it now hates tech and the commuter buses it rides in on? As for rural California, just try to get past zoning approval for anything that isn't beige.

          • by Cyberax (705495)
            Nope. California's budget is very solidly in black, average salary is way higher than in Texas and industry is _growing_. It turns out, that being a nice place to live attracts business.
        • Re:Texas! (Score:5, Insightful)

          by cant_get_a_good_nick (172131) on Monday July 21, 2014 @10:34AM (#47500417)

          What made the oil industry successful is oil. Whatever regulations or non-regulations you want to give, if there's no oil, there's no oil industry.

          It can be argued that silicon valley grew because of California University school system. A good chunk of which is publicly funded. Remember Sun stood for Stanford Univeristy Network. Google started at Stanford. A good chunk of Apple Mac OSX and iOS is BSD, developed at University of California, Berkeley. The Internet as we know it started at Berkeley - one of the first TCP/IP stacks was just known as Berkeley Sockets. The Internet was at first a DARPA project (government funded) for distributed command and control. The work then went to California universities, trying to share scarce computing resources.

          • by sycodon (149926)

            California has lots of oil too.

            It remains locked up by the Environmentalists and Bureaucrats. So you have oil, but no oil industry to speak of.

      • Re:Texas? (Score:5, Interesting)

        by luis_a_espinal (1810296) on Monday July 21, 2014 @09:37AM (#47499995) Homepage

        I mean, it makes perfect sense to reward a state that makes it as difficult as possible to sell a vehicle with Tesla's sales model.

        It makes perfect (business) sense to locate it in a state with depressed wages, huge amounts of available land, little-to-no zoning restrictions, lax environmental regulations, and politicians that are at least a buy-able as the rest. Hell, if it's good enough for the oil and gas industry...

        Really? You really want to go there? True that huge chunks of employment in Texas is in the Walmart-like category for people with no specialized skills. But for manufacturing and up, wages are decent and the economy is booming. Go to Austin, Dallas or Houston for good paying jobs without the ridiculous hassles that you see in the Bay area: ageism, gentrification, and most important of all, absurd zoning laws that prevent creation of new housing/rental units to accommodate the growing population (and which causes housing/rental prices to be absurd to anyone except couples where both partners are in IT/STEM/Software.). The same is true in Seattle, Portland ,The Triangle and Denver (in particular Denver.) Texas is doing fine, more than fine. Just because there are a bunch of backwater NIMBY small towns full of folks who thing America's best years were 30-40 years ago, that doesn't mean the state is crap. People are moving there in droves for a reason, small businesses are booming, people in manufacturing are doing well. And most importantly, whether you work in STEM or in a factory plan, you can still afford an actual house that is not a hole in the wall (Sillycon Valleeey, I'm looking at you.)

        Texas is doing well, and will be doing well for a long time. It is fair to criticize, but try to give some credit where credit is due every once in a while instead of blindly following the bash-your-favorite-dead-horse crowd.

        • by mirix (1649853)

          5th highest rate of poverty in the country. I guess even being poor is bigger in Texas.

          Sure, it's fine if you're a developer in Austin. But a lot of texas is... texas.

      • by haruchai (17472)

        That makes a stronger business case for China and it looks like they want Teslas much, much more than Texas.

      • by volmtech (769154)
        It is good for the oil and gas industry, and those who work in them. My nephew with his new EE degree just started with a pipeline company in San Antonio, $90000 a year with a housing allowance.
    • Re:Texas? (Score:5, Insightful)

      by StoneCrusher (717949) on Monday July 21, 2014 @08:35AM (#47499577)
      This is why you're not a CEO or politician. Building this factory in Texas would make it harder for politicians to fight "Texas Made" cars. Sure the mouth pieces and opposition will still be there, but the mouth pieces promoting the cars would get a lot louder. Once you get Texas on board, a lot of southern states are easier. They are looking how to move forward, not punish for history.

      Remember the next round of Tesla cars will be SUVs and bog standard sedans. Not pick up truck territory, but certainly Texas soccer mom and Austin city car markets.
      • by cdrudge (68377)

        Building this factory in Texas would make it harder for politicians to fight "Texas Made" cars.

        But that's a REALLY big gamble. While having a massive production plant may give you some extra leverage, once it's built it's not like Tesla will be able to just pack up and leave if they don't get what they want. I guess only time will tell which side wins.

        • Not so much. They need to build the plant anyway. Even if Texas doesn't start making it easier for Tesla to sell directly, the plant will still function. It's not like building it in a another state will make Texas happy. It's a Win/draw situation for building in Texas to help the Texas and southern market, not a win/lose.

          Now of course there are lots of other factors at play about where the factory will be built, but I'm pointing out that revenge is an absolutely terrible metric to use when making busine
          • by Dishevel (1105119)
            It is more like WIN/win for Tesla.

            They can get a good factory with sane levels of regulation and market wages and sell their cars in Texas or just get the former. Either way they win over California.

      • This is why you're not a CEO or politician. Building this factory in Texas would make it harder for politicians to fight "Texas Made" cars. Sure the mouth pieces and opposition will still be there, but the mouth pieces promoting the cars would get a lot louder. Once you get Texas on board, a lot of southern states are easier. They are looking how to move forward, not punish for history. Remember the next round of Tesla cars will be SUVs and bog standard sedans. Not pick up truck territory, but certainly Texas soccer mom and Austin city car markets.

        ^^^ This. You can't win manufacturing lobbying wars without winning Texas.

      • by Anonymous Coward

        Funny thing, even the rural rednecks would love a Tesla pickup truck:

        1: If they want to roll coal, a fake set of stacks and a fog machine can be added. Realistically, I live in Texas, and no rural farmer or rancher I know would ruin an expensive vehicle by detuning it and voiding the warranty, so why tempt fate?

        2: A lot of rural work requires electricity. Being able to pull out tools, plug them into an inverter on the side of the truck, then get to work would make life a lot easier in the middle of nowh

        • > 3. Electric motors have lots of torque

          This is why diesel railroad engines are used. In the words of Doc Brown, " No, no! This sucker's electrical!". The diesel motor powers a generator which drives the electric motor.

    • Re:Texas? (Score:4, Insightful)

      by alen (225700) on Monday July 21, 2014 @08:56AM (#47499695)

      what state is the largest producer of clean wind energy?
      hint, it's not california

      Texas is a big tech hub

      • Texas is the only state in the mainland that has its own power grid [wikipedia.org] too. So if the grid needs to be upgraded to support added load requirements, I would imagine it would be easier politically as it involves only one state.

        • by Hodr (219920)

          Factory for building batteries, owned by the person who owns the largest installer of solar panels in the US, only considering regions with a high percentage of clear sunny days. Somehow I think the power grid is not their primary concern.

    • by ganjadude (952775)
      for one, simply read necro81 post for why its a good idea to be in texas

      secondly, if they build the factory in texas, they might have more swing to get the law changed to allow them to sell direct. all in all its a win win for tesla going to texas.
      • I think it is more like Elon saying to texas, change the law and I will come to texas. Elon is just being Elon. Whichever state offers Elon the biggest basket of goodies is going to get the factory. It is bribery and corruption at its best here in capitalist usa.
    • A good CEO will not let politics, revenge or reward guide the decision, but rather consider the total package/environment and how that supports the success model. But, regardless of which states are in the running, the trick is to always have several competitive states in the mix right up till the end, even if you've already decided internally, just to make sure you get the best deal possible.
      • A good CEO will not let politics, revenge or reward guide the decision, but rather consider the total package/environment and how that supports the success model. But, regardless of which states are in the running, the trick is to always have several competitive states in the mix right up till the end, even if you've already decided internally, just to make sure you get the best deal possible.

        Hahahahaha, that is the stupidest thing I have ever heard? Where are you been all this time? Under a rock on Endor? Selling cars directly to customers is highly politicized, and there is no way a good CEO will make decisions without taking that into account.

        It would be nice if we had a true free market where companies can sell their products directly to customers (and let the best product win) without interest groups lobbying for their right to be "middle man". But this is 'Murika, land of the free (when

        • If yo think political battling should take precedence over actual financial setup success, good luck. FWIW, If Tesla wants Texas to change, the best way is to startup in Texas.
          • by timeOday (582209)
            No, the point is that ignoring politics is bad business, and particularly risky in the US where the door to political manipulation by business is wide open, so if one company doesn't do it their competitors will!

            Heck, look what Tesla already accomplished - they complained about California's ground rules, and got an exemption written into law for themselves - without casting a vote or spending a dollar! From the article: "On the legislative front, state Senate President Pro Tem Darrell Steinberg, D-Sacram

            • Certainly I didn't mean to totally ignore politics. If you took my post that way then I understand your response. My point is that primary drivers for a state & location selection are much more 'what can you do for me" based wrt taxes, infrastructure, energy cost, etc. If they get political concessions in that mix, great, but without those other items covered, the political end becomes meaningless.
              • Certainly I didn't mean to totally ignore politics. If you took my post that way then I understand your response. My point is that primary drivers for a state & location selection are much more 'what can you do for me" based wrt taxes, infrastructure, energy cost, etc. If they get political concessions in that mix, great, but without those other items covered, the political end becomes meaningless.

                That is not true, not with some industries, in particular energy which you mention. Politics play a pivotal role, even a primary one. No, that's not what I advocate, nor what it should be. But reality is reality, and until politics gets out of moneyland, and money gets out of politics, if people want to run a business on energy, transportation or pharma (just to name a few), CEOs will have to be political savvy and make decisions based on politics.

          • If yo think political battling should take precedence over actual financial setup success, good luck. FWIW, If Tesla wants Texas to change, the best way is to startup in Texas.

            That is not what I say ('Murika wtf, what happened to reading comprehension?), but hey, I am not one to judge you if are into building strawman arguments.

    • Texas has a seaport. The other states would require extensive trucking or rail infrastructure to move the batteries in bulk. But where will the next Tesla vehicle factory be built and does the gigafactory plan to have more capacity than Motors requires?

      • by cdrudge (68377)

        There's major rail lines that crisscross the nation. Anywhere there is an automotive plant they've figured out how to ship any number of large and/or heavy items that are needed in large quantities for the production of automobiles. While there is no doubt that convenient shipping would be advantageous, my guess is that Tesla's investment for transportation of supplies and vehicles would be similar whether it's in Texas, California, or any other place that has developed transportation infrastructure. It's

    • by JWW (79176)

      No state income tax for businesses.

      Really, this plant is building components for the cars built in California. There is actually no relation from the manufacturing side to the selling side here.

      This decision should be made puerilely on balance sheet issues that allow Tesla to make batteries and cars as cost effectively as they can.

  • by Gothmolly (148874) on Monday July 21, 2014 @08:26AM (#47499533)

    Slashdot hadnt yet posted anything about Elon Musk today. My groupthink-o-meter was starting to dip back down below 'fellate'.

  • by Dan East (318230) on Monday July 21, 2014 @09:46AM (#47500055) Homepage Journal

    Which California? I hear there are 6 now.

  • California was not in the running. Suddenly it is in the running. Looks like it is a simple bargaining strategy to extract more pounds of flesh from whoever is despo enough to want that factory. Expect 20 year tax abatement on property taxes, pledge to improve road/rail access to the factory site by local municipalities, some "flexibility" in enforcement of some regulations...

    Or typical evil big business as usual.

    As long as we coddle these "big" guys, they will take it all and come begging for more.

    "An

    • by khallow (566160)
      Well, California probably will go bankrupt anyway. Tesla seems a better sink for that money than most.
  • I'm surprised California would even be in the running. Land is expensive, taxes are high, and cost of living is among the highest in the country.

    By contrast, Arizona and Nevada have cheap land, low taxes, and low cost of living plus low labor costs.

    California's main asset is its technology population, plus access to sea ports.

    Should be interesting to see who wins. I would have thought that Mr. Musk would prefer to place his plant in a low cost region like Malaysia or south China, but I guess there are logis

  • Sacremento is out in the California Delta. There's already a severe water shortage, plus that crop land is among the best in the world. Bad place to build a huge factory that will draw thousands of people into the area.
  • "...vindication of Gov. Jerry Brown's..."

    Great reason right there to not pick California.

    How's that high speed rail construction project that was voted down by Californians 3 times with a large enough margin that it's a pretty clear shout of "Hell No!" each of the times it was vote on, that Jerry Brown is going ahead with anyway, working out?

    Is it still taking place in a corridor where land is cheap because there's no place to get on or off the damn thing that has any significant population that would const

    • by bledri (1283728)

      ..., not to mention that Texas has no income tax; what moron would build a factory in California? Elon was just being nice when he didn't categorically rule it out when asked.

      You realize that both the Tesla factory and the SpaceX factory are in California, right? So I guess Elon Musk is a moron...

(1) Never draw what you can copy. (2) Never copy what you can trace. (3) Never trace what you can cut out and paste down.

Working...