Tesla has finally decided that it will build its battery "gigafactory" in Nevada, sources say.
"That's a go, but they are still negotiating the specifics of the contract," a source within the Nevada's governor's office told CNBC Wednesday afternoon. The source noted that it could be a week before the deal is official.
Nevada is planning a press conference Thursday in Carson City, according to a Dow Jones report.
The Reno area has long been the front runner for the site. As always, the devil is in the details. So what is Tesla getting for what could be the most important auto manufacturing plant since the heyday of Detroit Motor City? Arizona lawmakers recently coughed up $400 million in taxpayer dollars to get the $5 billion plant. Senate majority leader Harry Reid recently tried to poo-poo the deal as a negotiating tactic. But it looks like Nevada had what Tesla was looking for: a whole bunch of land relatively close to its California HQ and low taxes.
• Few taxes: No personal income tax, franchise tax, estate tax, inheritance or gift tax, and no taxes on corporate shares. No corporate income tax, although voters will decide in November whether to implement one to finance education — a move U.S. Sen. Dean Heller, R-Nev., said could undermine efforts to attract Tesla
• Other tax credits or breaks: Up to a 50 percent abatement on personal property taxes for up to 10 years; a partial abatement on sales and use taxes on capital equipment purchases; and a deferral of sales and use taxes on capital equipment.
• Worker training subsidies: Up to $1,000 per employee for job training if the company provides a 25 percent match, makes a five-year business commitment and pays at least hourly minimum wages.
• Other advantages: Proximity to the assembly plant in Fremont, California, where Tesla makes its cars; significant deposit of lithium, which is essential to making the batteries.
And all indications are this is a done deal as Nevada has it in the bag. However, one has to wonder just how good Tesla workers will have it: Nevada is a right-to-work state. Will Tesla's 6,500 employees unionize? It's great that one of the hardest-hit states from the Great Recession (Nevada's unemployment was 13.9% this time four years ago and 7.7% now) is getting some badly needed jobs, but will they pay well?
We'll see. Dreams of an affordable, mass-produced electric car three years from now is one thing, but if it comes at the expense of turning Reno into Silicon Valley with its massive income inequality and obscenly broken housing market, then Tesla's plant needs to be unplugged.
Jury's still out on you, Elon Musk.