Tesla is closing in on incentive package for factory in Austin

Tesla is closing in on an incentive package with the local government in Austin for a new factory.

Last month, Electrek exclusively reported that Tesla’s next factory is going to be in Austin.

After our report, Tesla leaked that Tulsa, Oklahoma, was still in the running, but we were able to confirm that Tesla is already set to build in Austin, and it plans to move fast with hope to have a general assembly line for Model Y in Texas by the end of the year.

Now we learn that Travis County, where Austin is located, is reportedly considering an incentive package for the factory (via Statesman):

The Travis County Commissioners Court is scheduled to discuss the terms of the potential incentives deal in an executive session on Tuesday, according to people with knowledge of the proceedings. A vote is expected in the coming weeks.

It’s currently unknown what kind of incentives they are planning to vote on, but Electrek has learned that Tesla has been in communication with the local government for months.

In May, Travis County commissioners lifted a moratorium on economic incentives for two months — just in time to make a deal with Tesla.

The United Auto Workers (UAW), who Tesla has been fighting against for years to keep them out of Fremont factory in California, is already campaigning.

Cindy Estrada, UAW vice president, made some curious comment:

You have to look strongly at the track record of a company and their commitment not just to public dollars, but to the community investment and actual return on jobs created. Tesla has a track record of collecting public subsidies from several states but not delivering on their promises. That is why it is important this time for Tesla to commit to community assurances for Travis County before getting subsidies.

It’s unclear what she is referencing since Tesla has reached all its investment and employment goals under its incentive package with Nevada for its Gigafactory outside of Reno, and the plant has had great economic impacts in the region.

CEO Elon Musk has been referring to Tesla’s new factory as “Cybertruck Gigafactory” because it will be where Tesla produces its new electric pickup truck.

However, Tesla also plans to produce Model Y at the factory and the Model Y production is expected to come online before Cybertruck production.

Electrek’s Take

I’ve been saying it. It was Austin all along, but Tesla played Tulsa to get better leverage for this incentive package.

I am sure that they will get a decent deal, but it’s not the main reason they are coming to Austin. Tesla wants the local engineering talent, which they already got to know through their Autopilot hardware engineering team in the city.

Texas is also more “business-friendly” to a degree than California, and at this point, Elon’s discontent with the state of California has been made clear.

We should have more on the Austin Gigafactory project soon. Stay tuned.