Texas Tempts Tesla With Tax Breaks

by Matt Posky

Published: July 15th, 2020

If you happen to find yourself running a section of this country and would like an automaker to build a factory there, we’ve got a couple of tips to help improve your odds. It might be unfair to call them tips, however, as they’re common knowledge and realistically the only way to get a business to settle on your land. Step One involves promising as much money and as little regulation as possible. Step Two involves waiting for their response.

Hoping to beat out Oklahoma as the home of Tesla’s Cybertruck, Texas is attempting to dazzle the electric automaker with the tax breaks it knew the company wanted. All the automaker has to do is spend over a billion dollars to build its facility in Travis County.

According to Reuters, county commissioners have voted in favor of providing Tesla with a tax rebate worth at least $14.7 million. That’s thrown on top of the $50 million incentive approved by Del Valle school district last Thursday.

From Reuters:

Tesla has asked Travis County for an 80 [percent] rebate on its property taxes for 10 years, worth $14.7 million, as well as a 65 [percent] rebate for the next 10 years after that.

Tesla said the factory would create 5,000 jobs, mostly low-skilled. The average annual salary would be roughly $47,000, an income considered low by the county’s health and human services division.

Tesla is eager to distance itself from California after CEO Elon Musk defied local officials during lockdown measures aimed at curbing the spread of COVID-19, suggesting the county’s protocols were beyond the pale. Musk wanted to keep the factory open with employees having the option to stay home if they wished (without repercussions or pay). He has also called shelter-in-place orders “de facto house arrest” and accused California of using the pandemic to promote tyranny.

But he ultimately acquiesced to a temporary closure after butting heads with local officials, vowing to get out of California. “The unelected & ignorant ‘Interim Health Officer’ of Alameda [County] is acting contrary to the Governor, the President, our Constitutional freedoms & just plain common sense,” Musk tweeted in May. “Frankly, this is the final straw. Tesla will now move its HQ and future programs to Texas/Nevada immediately.”

Oklahoma has also been added to Musk’s shortlist of possible locales in which to build a $1-billion factory focused on Model Y and Cybertruck assembly. However, it will take quite a while for the business to totally decouple from California, as the Fremont facility is currently essential for its business. Tesla would evaporate without it humming along on a daily basis — giving us another hint as to why Elon was so pissed about the lockdown orders.

[Image: Tesla]

#AutomotiveIndustry #Cybertruck #ElonMusk #FactoryNews #IndustryNews #Tesla #TeslaMotors #Texas

Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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2 of 14 comments

Dave M. on Jul 16, 2020

Have you been to Austin? The entire central Texas corridor is bright blue.

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Johnster on Jul 16, 2020

We can call it "Stella" for short. https://www.youtube.com/watch?v=6q3fBK6LbCc

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