California will give Tesla Motors a $34.7 million tax break to expand the company’s production of electric cars and powertrains in the state, officials announced Tuesday.
Tesla, based in Palo Alto, won’t have to pay sales and use taxes on new manufacturing equipment worth up to $415 million.The equipment will help Tesla more than double the number of Model S sedans it builds at its Fremont factory, as well as assemble more electric powertrains for customers such as Daimler and Toyota.
Tesla expects to build 21,500 sedans this year. The new equipment would help expand annual production by 35,000 cars.
Interestingly, the stock is down against the broader up market today and I’m not sure why based on this seemingly positive news. (Update: Someone with a Tesla had a Fire in their garage)
California State Treasurer Bill Lockyer (riding shotgun to Gov. Jerry Brown in the video above) said “I’m pleased we could take this action to encourage Tesla to expand its electric vehicle production in California, which will create green jobs and improve our air quality.”
Specifically, California estimates that the additional production capacity will create 112 permanent jobs in the state as well as $60M in total revenue.
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