(Updated with comment from Tesla)
Nevada was one of the states hit hardest by the great recession of 2008, and it is one of the states that has had the hardest time coming back. It currently has a 7.7% unemployment rate, one of the worst in the country. But it could be getting a nice big boost soon.
Tesla has chosen Nevada as the site for its Gigafactory plant, where the company would manufacture the batteries for its line of electric cars, according to a report from the Wall Street Journal on Wednesday.
Nevada's Governor, Brian Sandoval, is expected to announce the news on Thursday afternoon. He teased the unveiling in a Twitter post:
Stay tuned for a major announcement tomorrow at 4PM related to economic development in #NV.— Governor Sandoval (@GovSandoval) September 3, 2014
"We continue to work with the state of Nevada and look forward to joining the Governor and legislative leaders today in Carson City. Discussions with the other states in the process are ongoing," a Tesla spokesperson told VatoNews. "We’ve always said we anticipated breaking ground at more than one site for the Gigafactory and would refer you back to Elon’s previous statements on the subject, specifically those he made on our most recent earnings call, for further context."
The plant, which could be as large as 10 million square feet in size, would be bigger than any single factory in the U.S. It will also cost roughly $5 billion.
Where is Tesla going to get that kind of money? At least part of it will come from selling off stock.
Back in February of this year, the company revealed that it was looking to raise $1.6 billion by selling convertible senior notes, with alf of the notes to be due in 2019, and the other half due in 2021. In addition, another $240 million are being granted to underwriters, bring the total amount that Tesla could raise to $1.84 million. The company confirmed at the time that money was going to use it to build the Gigafactory plant.
Funding could also come from investors; in July it was reported that Panasonic had reached a basic agreement to invest between $194 million and $291 million, with the potential for up to $1 billion invested in the factory.
Tesla had said that it had narrowed the potential site for the plant to four states: either Nevada, Arizona, New Mexico or Texas. Obviously getting such a project would be a major boon for any state, as it will lead to an increase in both manufacturing and jobs in the state. In all, the company reportedly plans to hire up to 6,500 workers in the factory, which will produce 35 gigawatt hours of battery cells every year.
So why was Nevada chosen? The reason could be that it is close to Tesla's assembly plant located in Fremont, Caliifornia (hey, that's where I live!), whereas the other states in question would have been much further away.
The company is looking to finish building the Gigafactory by 2017, as that is when it plans to unveil its third line of electric vehicles, known as the Model III.
(Image source: autoblitz.pics)