Tesla to build a new Megafactory in Texas near Houston

Tesla is going to build a new Megafactory in Texas near Houston, according to a tax abatement agreement with Waller County.

At the time of writing, Tesla had yet to comment on the new project, but the Waller County Commissioners Court confirmed the project on Wednesday when they approved a tax abatement deal with the company:

Under the proposed agreement, Tesla will receive tax abatements from Waller County based on property improvements. The deal includes $44 million in facility improvements and $150 million in Tesla manufacturing equipment that Tesla will install. The next phase involves a new $31 million distribution facility with about $2 million in Tesla distribution equipment and building upgrades.

Tesla is going to take over a 1-million-sq-ft building that it already held the lease on at the Empire West industrial park near Katy, Texas – just outside of Houston.

Logistics company DB Schenker occupied the space where it handled parts for Tesla, but it will move out and Tesla plans to build Megapack production lines at the site:

Tesla will operate a new Megapack battery storage manufacturing facility at a 1 million-square-foot building, which was initially constructed with no tenant on speculation that it would attract jobs and economic development.

Tesla has previously referred to plants producing Megapacks as “Megafactory”. The company already operates one in Lathrop, California, and one in Shanghai, China, where it just started production.

Those factories are set up for a production capacity of 40 GWh worth of Megapacks per year.

It’s not clear if Tesla plans for a similar capacity at this new factory, but the county announced project should result in creating 1,500 jobs.

In addition to the existing building, the project will include the construction of an additional “600,000-square-foot distribution facility with some manufacturing capabilities.”

Unlike its automotive business, Tesla’s energy business has been growing at an impressive pace – although prices and margins have come down last year.