Tesla Death Watch 20: California Dreamin'

Edward Niedermeyer
by Edward Niedermeyer

Tesla Motors says it’s secured 90 acres between San Jose and Santa Clara, CA to build its world headquarters. Oh, and production facilities for its (supposedly) upcoming Model S (nee White Star) sedan. The announcement is creating all kinds of excitement among the kind of people who use terms like “green collar jobs” and “cleantech.” “It’s not just another solar company,” says San Jose Mayor Chuck Reed. “It’s an electric car, which has tremendous upside for us, and a whole new area of job potential.” And of course that excitement translates into taxpayer handout. The San Jose Mercury reports that the City of San Jose will sign a 40-year lease with Tesla for the land, providing the first 10 years rent-free. “In years 11 to 20, Tesla will pay $1.5 million a year for the property, and then see rent increases of 2 percent a year in years 21 to 40. Tesla will pay the usual development fees… but the city will look for a way to rebate them over time once tax revenues start flowing in from the company.” Governator Schwarzenegger has already offered to waive sales taxes on the first $100m of equipment purchased for the factory (angering not a few non-automotive manufacturers). And the plant is being built using a $150m federal Department of Energy loan guarantee. Hey, what happened to the whole Tesla in New Mexico deal? Nothing.

Edward Niedermeyer
Edward Niedermeyer

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  • JEM JEM on Sep 18, 2008

    marc_m - Tesla's never been about cheap, and there's no way to build a 'cheap' EV. The problem with Tesla to date has been that Elon Musk's money brings Elon Musk with it, and his absolute devotion to making the perfect the enemy of the good has delayed the Roadster by years. Deciding to build in California, no matter the incentives offered, is pandering to image over business common sense.

  • Joeaverage Joeaverage on Sep 18, 2008

    Surprised that Telsa who I'd guess want to make a profit would settle in Southern CA where everything is expensive instead of the south east US where there is cheap land, cheap labor, and cheap parts suppliers all over. Good luck to them. America needs their EVs. I look forward to the version that people of more modest means can afford.

  • Tauronmaikar Tauronmaikar on Sep 22, 2008

    Tesla settling in CA is just further proof that this company is about marketing and hype and not about mass producing cars. Joeaverage: don't hold your breath.

  • Joeaverage Joeaverage on Sep 24, 2008

    I suppose their big argument would be that they are settling nearest their potential customers. Rich people, mild weather where batteries behave better, and where the mindset might be more friendly to the EV concept. Maybe the Tesla people just want to live in CA. Didn't Nissan have a hard time getting everybody to move to Tennessee? Nissan obviously thought they would save some cash being here. Still build them in the southeast and sell them everywhere. Would be a BIG savings.