Tesla Visits Santa Monica, Deciding Where to Build $5 Billion Factory

Tesla Visits Santa Monica, Deciding Where to Build $5 Billion Factory

SANTA MONICA — Tesla Motors gave a presentation to a sold-out crowd of 175 people at Cross Campus, an entrepreneur co-working space, on Tuesday night. While the presentation mainly focused on design aspects, it came at a time when the company is debating where to build a $5 billion “gigafactory” to manufacture electric car batteries.

Tesla lead director of product design Javier Verdura opened the presentation by promoting the company’s success in the American automobile market.

“In this day and age, trying to launch a car company is incredibly difficult,” he said. “I think the last American car company to be successful was Chrysler, and that was 100 years ago.”

Verdura stood in front of a large projection screen and narrated while a slideshow played behind him. 

“Our mission at Tesla is to accelerate the world’s transition to electric vehicles,” he said.

The engineers and product designers in attendance listened intently as Verdura outlined the company’s product history, beginning with the Roadster in 2003 and continuing with the Model S just a few years later. He also provided product specifications and pictures of the Model X, the company’s next offering slated to begin shipping early next year. 

The crowd was so quiet and attentive that one could hear the proverbial pin drop, while Verdura discussed the company’s “superchargers,” a network of electric “gas stations” that is poised to expand significantly in the coming months. The supercharging stations can fully recharge a Tesla electric car to a 170 mile range in just one hour and are completely free to use.

“Imagine if Henry Ford, when he was building the Model T, built gas stations himself and gave away the gas for free,” he said.

Verdura also talked about the company’s three main facilities: a manufacturing factory in Fremont, California, and design studios in Palo Alto and Los Angeles. However, he declined to discuss the company’s imminent plans to build a $5 billion battery manufacturing facility. California, Texas, Nevada, New Mexico and Arizona are all competing to be the site of the new “gigafactory,” which will bring in an estimated 6,500 jobs. California, looking to lock down the deal, has offered specialized financial incentives to Tesla, should they build the factory in the Golden State.

Still, at least one California lawmaker is not impressed with the state’s offer of special accommodations. In an open letter to Tesla Motors CEO Elon Musk, California Assemblywoman Shannon Grove (R-Bakersfield) says that while she plans to support the passage of the specialized tax credits, the company would be better off building their factory in a more business-friendly state.

While I plan to support the measure, you and I both know that this offering does not do nearly enough to make the California business climate competitive in the national and global market. And you can bet the Legislature will brag about how accommodating they are being by tossing tax credits your way, yet offering nothing in substantial change to the anti-business climate in this state.

Assemblywoman Grove goes on to list the most serious problems contributing to the state’s hostile business environment: California has the fifth-highest corporate income tax rate in the country, the highest sales tax, and the worst real poverty rate among all states.

“There is a growing stream of frustrated and resentful Californians leaving the state to find employment in more accommodating environments,” she wrote.

Still, Grove thanked the company for their innovation and entrepreneurial spirit, before ending with a hopeful thought.

“I believe that with the hard work and ingenuity of people like you, and by implementing policies which allow business to thrive, we can turn California back into the Golden State,” she said.