Tesla Motors Inc (NASDAQ:TSLA) is officially considering four states for its much-anticipated multi-billion-dollar battery plant. However, a report from USA Today citing site selection experts says the battle is really down to just two sites, “one heavyweight and a plucky upstart”, i.e., San Antonio and Reno.
John Boyd, a principal of Princeton, N.J.-based site selection firm The Boyd Company, said “A case can be made for both Arizona and New Mexico…and you have to give them credit,” and added, “but the two leading contenders are Reno and San Antonio.”
Smart strategy from Tesla
San Antonio is a big city with a great opportunity for economic development. In contrast, Reno is less than one-fifth of the San Antonio’s population and also lacks financial incentives.
Boyd views Tesla Motors Inc (NASDAQ:TSLA)’s strategy as intelligent; even if information leaks out about one possible Tesla site, there would be no harm to secrecy. Also, the strategy would help Tesla get concessions from the states, including changing the franchise model for car sales.
“I think it’s just a matter of Tesla saving time on the development process once it picks a site,” said Dennis Donovan, a principal with another New Jersey-based site selection firm, Wadley Donovan Gutshaw Consulting. Donovan added that there is nothing actually wrong with the concurrent development for those communities even if Tesla decides to move somewhere else, as the site infrastructure will be beneficial for other prospective tenants.
Nevada a strong contender
The EV manufacturer is in no hurry to announce the final site for its Gigafactory and will only reveal by the end of this year. Site selection experts say that the company will consider two or three states, which is unusual.
Tesla Motors Inc (NASDAQ:TSLA) has said that it is also considering Nevada for its massive battery factory, there was a discussion last week between the local economic development officials and Tesla officials, suggesting that the Reno Tahoe Industrial Center would be the site if Tesla comes to Nevada.
Both Boyd and Donovan agree that Tesla Motors Inc (NASDAQ:TSLA) will be a game changer for the state that gets the factory. As many as 6,500 jobs will be created, along with $4 billion to $5 billion investment for the facility.