Tesla Motors Inc (NASDAQ:TSLA) demanded $500 million in cash from Nevada instead of just getting tax abatement during negotiations, according to a latest report that talked about the process of deal between the electric car maker and other contesting states for Gigafactory. This demand from Elon Musk brought the deal with Nevada to the verge of collapse.

Tesla Motors Inc CEO Demanded $500M From States For Gigafactory

Musk’s demand almost ended Nevada deal

A report in Fortune magazine writes that Elon Musk tabled the demand of cash after Nevada governor Brian Sandoval already got legislative leaders to back a 20-year package of incentives. Nevada showed its inability in fulfill the demand from Tesla as the entire state budget is $6.5 billion, says the report.

Musk headed to the other states with his demand, but could not convince anyone to give the $500 million needed to help Tesla Motors next-generation of electric cars. After realizing that there would be no takers for his proposal, Musk decided to drop the cash demand and entered into serious negotiations with Nevada. Nevada came out as a winner with a $1.4 billion incentive packages for the 6,500 jobs promised by the project. The report noted that the states did not leave any stone unturned in wooing Tesla for its Gigafactory.

What Tesla promised in return?

Nevada emerged as the clear winner, offering a 980-acre site outside Reno, and a plan that will cost $200,000 per direct job in subsidies, as reported by the magazine. Tesla agreed to the terms, but Musk insists that the state did not get any special deal. Musk came out clearly during the earnings calls saying that the rumors of Nevada getting a sweet-heart deal kind of “bugs” him. He said that the company did get incentives and scale, but it is not extraordinary.

“I thought we got an okay incentive package, given the scale, but not a super-huge one,” Musk said earlier.

Despite Musk’s claims, it cannot be ignored that Tesla Motors Inc (NASDAQ:TSLA) is getting huge incentives in Nevada, and in return, apart from 6500 jobs, the company is offering $3.75 million in donations to local public schools to be opened in 2018 and $1 million to support battery research at the University of Nevada.