Tesla has chosen a location near Austin for its next U.S. plant, a $ 4 billion to $ 5 billion plant that will feature the automaker's futuristic cyber truck, the Tesla Semi, and the model Y and Model 3 will be assembled for sale to customers in the east coast.
The decision has been announced Wednesday During Tesla's second quarter earnings call, the quick and furious search for the best location – and the incentive deal – for the next US plant ends. Construction of the factory, located east of Austin near the airport, is slated to begin this year.
Tesla CEO Elon Musk described the future factory as an "ecological paradise" with a promenade and bike paths where the public will be welcome.
Upon completion, the Austin facility will be added to a growing portfolio of factories and parts factories in the United States, China and Europe. The S, X, 3 and Y models are assembled in Tesla's first US plant in Fremont, California. Other Tesla U.S. factories include Gigafactory 1 near Reno, Nevada, which manufactures battery packs and electric motors for Model 3, and an assembly plant for solar modules in Buffalo, New York. Tesla opened its plant in China at the end of last year and is building another large assembly plant in Berlin.
The fact-finding mission for this latest factory was first released in March when Tesla's CEO Elon Musk tweeted that the company was looking for a location in the central part of the United States. Tesla eyed Nashville, but later dropped plans to focus on a site east of Austin in Travis County and on land in Tulsa, Oklahoma. While Austin has been a pioneer from the start, it has not stopped Oklahoma's speculation or effort to attract the company.
Oklahoma has never released its proposed incentive package. In Texas, details of two incentive deals became known as the proposals meandered through the public hearing process.
Musk thanked Tulsa and Oklahoma and when called, remarked that he and the team were "super impressed" with the state and would consider it for a future location.
Tesla has promised Texas officials to employ at least 5,000 people. Approximately 25 of these workers are classified as "skilled" jobs and receive a minimum of $ 74,050, while the remaining jobs are middle income and annual salary $ 47,147.
The Del Valle School District was the first to approve Tesla incentives in one country Property tax reduction package worth $ 46.6 million. Commissioners in Travis County followed the leadership of the district. The county approved property tax relief worth at least $ 14.7 million, and possibly more, on July 14 over a 10-year period.
Under the agreement with Travis County, Tesla must invest $ 1.1 billion in the new factory within the first five years. In return, Travis County will reimburse 70% of Tesla's property taxes. As soon as Tesla's investment in the factory exceeds the $ 1.1 billion mark, property tax refunds will rise to 75%. Tesla receives 80% of the property tax rebate on investments in the factory in excess of $ 2 billion.
Travis County has estimated that a $ 1.1 billion investment by Tesla over a 10-year period would generate new tax income of $ 8.8 million, a figure that takes into account property tax rebates.
If Tesla does not meet the investment goal or if it is 75% below its job requirements in one year, the company will not receive a property tax relief. The county can also get tax breaks if Tesla violates his contract.
Together, Tesla will receive a minimum of $ 61 million in property tax relief. It is possible that Tesla will get more from the state.