Thứ Ba, 1 tháng 11, 2016

Tesla Gigafactory Investor Thread part 10

  • Aug 10, 2014
    JRP3
    The fact that Texas won't allow Tesla to sell cars seems like a good reason to me. Does anyone think Tesla will build the GF in a state that won't allow them to sell cars? Best part is, Tesla can say that's the reason they didn't go with Texas, which might put pressure on Texas to change their laws in the hopes they might get a future GF.
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  • Aug 10, 2014
    Cattledog
    If Tesla wants to keep the leverage, off the record they're saying 'you change laws, you get the next one'. The next legislative session starts in January, so after they really ought to be seriously building the thing, which means it's unlikely to get the first one. California and Nevada are the clubhouse leaders.
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  • Aug 10, 2014
    Model 3
    Remember that Elon mention that Texas may get the Truck factory (if they change the law) when Tesla starts to make EV-Trucks...
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  • Aug 10, 2014
    Jackl1956
    A couple of questions come to mind:

    First, if $800 million is on the table, what else has been proffered?

    Second, if $800 million is on the table why is Elon saying $500 million?

    I know that there are tremendous complexities to a deal of this magnitude, but some things are not adding up. Makes me question the validity of the news article. I would love to be a fly on the wall.
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  • Aug 10, 2014
    kenliles
    It's a long shot for me- even if otherwise a good location. Just can't see making the the primary component for a product you're not allow to sell.
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  • Aug 10, 2014
    TexasEV
    There's a lot more at stake here. If tax and other incentives make Texas a better deal by tens of millions of dollars, the lack of direct sales is relatively insignificant. Don't forget that Tesla not being able to sell in Texas isn't the same as people not being able to buy in Texas. We order online. Texas is a large market for Tesla already, suure it would be larger if it was less of a hassle to buy here, but I haven't heard it stopping anyone who wanted one.
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  • Aug 10, 2014
    JRP3
    True, Texas being a greater distance from the Tesla factory means greater transportation costs for battery packs as well. So Texas would need to compensate for that, along with the unfriendly sales atmosphere.
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  • Aug 10, 2014
    JBusch
    TexasEV - great point. Texas purchases seem to be doing well regardless of the current laws.
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  • Aug 10, 2014
    chickensevil
    I am reminded of Elon's comments about how they are trying to avoid moving the molecules as much as possible. To me it would seem that it would be far better to stick the factory in NV or CA just because of the proximity to Fremont over anywhere else. Maybe when they make their second auto factory in the US it will be worthwhile to have one of those other states have a factory as well. I will be shocked if TX gets it for that reason alone.
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  • Aug 10, 2014
    MartinAustin
    Totally agree. I have always thought that Texas has never been truly in the running... no matter how efficient CSX claims rail freight to be.

    I think that if Texas bends over backwards and repeals their dealer protection law, Tesla will simply say "we have decided to go somewhere else, but thanks for repealing that law." I doubt Texas would re-instate the law, no matter how smarting they may be.

    If Texas doesn't repeal its law, Tesla can simply say that was the reason they were eliminated from the running - and it will get a lot of publicity since the media likes monopolies scandals. In the end it doesn't mean a thing for Tesla, who still sells every car they can make.

    The Texas Congress doesn't meet until January, which could well be too late for Tesla (if they have been breaking ground 7 months prior) - so perhaps Cattledog's comment above is right on the money.
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  • Aug 11, 2014
    Lump
  • Aug 11, 2014
    daniel Ox9EFD
    Asking for ~500 million $ from a poor state seems unethical on face value. I hope Elon would give more clarification on the reasoning behind this request, or perhaps help correct the perception if this is not the case. This seems to be what the media understood too from reading around, anyway.
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  • Aug 11, 2014
    Zaxxon
    Well, you have to keep in mind that 'asking for ~500 million $' is not what's actually happening. It's not as though Tesla is asking for a gigantic check from the state. They're likely looking for concessions in fees (taxes, etc) that Tesla would have to pay in the process of building and running the factory. In other words, they may be asking the state to take $500 million less than they would have if Joe American built the same factory. In the meantime, the state reaps much more than $500 million in additional income from the appearance of the factory.
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  • Aug 11, 2014
    austinEV
    Look, Texas is the nation's #2 semiconductor employer. I would argue that for skilled employees, you are talking about semiconductor workers, both engineers and operators.

    Texas is the nations No. 2 semiconductor job market after California, says industry trade group | Dallas Morning News

    map.JPG

    And Texas is a big and important market for Tesla. I am disappointed by all this "punish Texas" talk. The no-direct-sales thing is a non-factor for sales. And if you want it fixed, locating the factory there is a powerful incentive. In the long term though, the *temporary* lobbying power of some dying industry is just not going to be a big deal. Locating the factory near a large pool of skilled workers and potential customers should be the focus.

    Plus it would allow tesla to be anchored in the reddest and bluest of states. If someone at TM were to take ya'lls advice and say "we didn't locate in texas because they are backwards redstate knuckleheads" they would make TM an enemy of the right, something they have largely avoided since paying back the DOE loan and creating jobs in a noisy fashion.
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  • Aug 11, 2014
    bollar
  • Aug 11, 2014
    Robert.Boston
    The big cost of transport is loading and unloading -- once it's on a train, the extra miles don't add much cost. Extra miles aren't free, but not enough to make or break a decision.
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  • Aug 11, 2014
    Jackl1956
    The Port of Stockton has a deepwater ship channel. The ability to ship battery packs directly to Europe and all points east cannot be underestimated.
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  • Aug 11, 2014
    Cattledog
    However those molecules, more of them actually, have to get to the plant in the form of raw materials. There's a lot of speculation that some materials may be sourced from California or Nevada, however right now I believe the majority of the raw materials come from overseas. So access to a port is desirable. Stockton area is very close, Reno OK. San Antonio is closer to a port than Reno.
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  • Aug 11, 2014
    bollar
    This is going to start getting silly, if it hasn't already:

    The Port of Galveston has a deepwater ship channel. The ability to ship battery packs directly to Europe and all points east without passing through the Panama Canal or Cape Horn cannot be underestimated.
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  • Aug 11, 2014
    chickensevil
    If they are expecting 40% in Asia and only 20% in the EU seems to me like it would be a better call to put the port access near your 1st or 2nd largest customer base... Not your bottom. Although if they really do plan to build a factory in China first it might actually be better to pick the Atlantic side for your port access... Unless as you say most of your raw materials are being sourced over seas... Then it would likely be best to go with whichever aide would help the most there.

    Honestly I think most all of their materials will be found here in NA. Lithium. Check. Nickel. Check. Cobalt? Carbon? (Either synthetic or natural) Check. What else is there? Aluminum? Check.
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  • Aug 11, 2014
    blakegallagher

    Am I the only one who heard Elon say that all of the materials would come from NA? I could of sworn I heard him say that more than once.
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  • Aug 11, 2014
    Jackl1956
    Tesla's Fremont factory (with it's world class robotics) is located in the Silicon Valley for a reason. The ability to draw upon the skills of the Bay Area talent pool is the cornerstone of Tesla's innovation efficiencies. The same paradigm, robotics and Silicon Valley ingenuity (talent pool) should be the Gigafactory blueprint.
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  • Aug 11, 2014
    chickensevil
    If so, then that should help in determining location right? I don't recall this information so it could be.

    I was mostly just bouncing ideas with my comments in trying to figure out what might be driving their choice.
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  • Aug 11, 2014
    Cattledog
    I asked Diarmuid O'Connell at TMC Connect what were the criteria for selection of the GigaFactory location and who was involved in the decision. He said labor, energy, logistics and incentives were factors and that the leaders of powertrain, manufacturing, technology, public policy and finance would be the deciders.
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  • Aug 12, 2014
    AlMc
  • Aug 12, 2014
    30seconds
    no comments on clear political risk in Texas? I have no idea why Tesla should trust Texas to protect its #1 future investment given the state's very anti-Telsa position so far.

    "Hey trust us since you are now giving us money" seems like a opportunity for disaster. Or, at least until the next largest check bearing (cough, oil) organization takes the higher bid position.
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  • Aug 12, 2014
    TexasEV
    There is no political risk in Texas with regard to tax or other incentives for economic development. No one is "anti-Tesla", there are many politicians who are beholden to the auto dealers, but none of those would consider taking any action to prevent a massive factory from being built. If Tesla builds the gigafactory in Texas it becomes another "local business" with thousands of jobs and would be protected by the politicians.

    Whether direct sales are allowed in Texas is likely very low on the list when tens of millions of dollars in incentives are being negotiated. Tesla sells plenty of cars in Texas-- online, so the sale is technically not "in" Texas.
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  • Aug 12, 2014
    30seconds
  • Aug 12, 2014
    Jackl1956
  • Aug 13, 2014
    mark
  • Aug 13, 2014
    Jackl1956
    I have always respected Texans. They have long tradition of standing up for their beliefs (what city is the Alamo in?). I believe the Gigafactory should go to Texas. Right after Texans stand up for freedom of commerce.
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  • Aug 13, 2014
    jhm
    I wonder if Tesla will simply build out two or more gigafactories at the same time. In the long run they'll need both. And in the short run, if either state gives them grief, they can simply stall the one in that state and build out the other. They can build out 100 jobs worth at a time. But if they commit to just one state, they will lose some of their political leverage and be held up at any point in time. I'm not sure I see the case for committing to a single state.
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  • Aug 13, 2014
    Robert.Boston
    Tesla doesn't have the cash to build more than one now. Starting several? Sure. But at some point Tesla has to pick one horse and ride it.
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  • Aug 14, 2014
    Model 3
    I was thinking the same as you, but concluded, as Robert.Boston, that Tesla don't have the money to do this at this time. But I will not be surprised if they do more then just "break ground" in more then one location, and when they pick one location to build fast, I guess they keep the other(s) and build them out slowly with whatever they may have left of free capital. That way they can have GF II and III up and running in "no time" when they need it and have the money to do it.
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  • Aug 14, 2014
    Familial Rhino
    I'm really glad Tesla is now on record saying they are not seeking to be exempt from environmental regulations, and that the only issue is speed.

    Article here.
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  • Aug 14, 2014
    chickensevil
    I am glad they are on record too, because it will quell all the naysayers. Although I think most of us know already that Tesla's mission is to bring about sustainable transportation, so not meeting regulations that are supposed to protect the environment would certainly be counter to that. I think they just don't want people using these regulations as an excuse to hold them up and slow them down, just like happened with that stadium that was referenced in the article.
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  • Aug 14, 2014
    austinEV
    bah, if we don't do something about global warming soon, that tumbleweed lizard that may or may not be disturbed by the factory is screwed anyway. Not that that is a good message for TM to try to sell.
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  • Aug 14, 2014
    Familial Rhino
    I don't disagree with you on that, but...

    Exactly. Can you imagine the headlines if Tesla would be granted permission to pollute, and they took advantage of it? I mean, I have to read "the billionaire Elon Musk" in every article about his enterprises, as if all the things he's trying to do are just the pipe dreams of someone who can afford to throw money to the wind and has "access" to the Obama government. Now I'd be told the billionaire Musk is also a hypocrite, and the worst of it is that I wouldn't have a good counter-argument.
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  • Aug 14, 2014
    Robert.Boston
    I deeply sympathize with Tesla's position. My company is working through the environmental process to build a large ocean-wave energy park off the Central Coast of California. We get almost no credit for displacing fossil-fueled generation; it's all about impacts on local species, etc. No "think global, act local" in California's process.
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  • Aug 14, 2014
    AlMc
    Robert, I recall that you had a conversation with a Californian that led you to believe that the GF being placed in Cali was a strong possibility. My contention has always been that TM 'heart' may say California, but it's 'head' (business decision) would say Nevada. I just feel that it will get built quicker (which is Elon's stated main criteria) in Nevada than in CAli where I think there will be many challenges...both with existing ordinances/laws and legal challenges by environmental groups.

    Still believe first GF in Cali?
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  • Aug 14, 2014
    Robert.Boston
    The perspective I got was from a California official -- and they want to do everything in their power to keep Tesla in California. I don't have any insight into Tesla's assessment of the relative merits of California / Nevada / etc.
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  • Aug 18, 2014
    Jackl1956
    I believe that California is the right choice for the Gigafactory.

    Tesla is worth the fight - SFGate

    California's entrepreneurs and engineers created Tesla. California is the No. 1 market for Tesla cars. California is a world leader in renewable energy, energy efficiency and ground-breaking climate-change legislation. In short, Tesla clearly shares our values. There is no reason other than a lack of will or imagination for this factory to locate anywhere but California
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  • Aug 18, 2014
    chickensevil
    Tell your government to hurry up with the permitting then! ;)

    I have no issue with any location (mostly because I am way over here on the east coast) I just want them to start pouring concrete on the final site already!
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  • Aug 18, 2014
    Jackl1956
    The current California legislative session ends on August 31.
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  • Aug 18, 2014
    chickensevil
    You think they will come up with something before the session ends? When does the next one start?
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  • Aug 18, 2014
    Robert.Boston
    Based on what I heard in Sacramento, I'd be stunned if the legislature doesn't get something through this month. The train will leave the station if they don't.
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  • Aug 18, 2014
    Jackl1956
    According to the California Legislative calendars August 31 is the final recess. The last day for both houses to pass a bill. I am confident California will enact legislation to win the Gigafactory. How Tesla and the other states react will be the $64,000 question.
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  • Aug 18, 2014
    RABaby
    Interesting read from Reid wrt the Gigafactory in Nevada.

    This statement by Reid seems to characterize Musk as being primarily motivated by money:

    �(Telsa CEO) Elon Musk, I know him,� Reid said. �I have spoken with him many, many times and he is a brilliant man. And that is probably an understatement. But he is in it to make money. And he�s going to take this Telsa project where he can make the most money."

    Maybe Reid's position is that Musk wants what is best for the company and his statement has just distilled all the elements down to Musk wanting to make money, but I see it as a very simple-minded perspective. Then again, can we expect anything more from a politician?

    Reid: Reno shouldn't start counting Tesla jobs just yet
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  • Aug 19, 2014
    eepic
    Of course Elon has a fiduciary responsibility to find a good deal for shareholders so the numbers are important. However, I don't believe that's his intrinsic motivation based on past actions. There are countless times in Elon's life he has made choices that are undoubtedly not the best risk-adjusted return for his money. For example, any sane person motivated by just money would not go into personal debt to try to save SpaceX and Tesla during the financial crisis.
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  • Aug 19, 2014
    chickensevil
    Overall not a bad article though. It is understandable where the guy (Reid) is coming from. I think a lot of it will actually come down to timing more than money. They seem willing to bite the money bullet if it means that they can be finalized tomorrow. I mean they don't want nothing, but I don't think the money piece is as critical. Keep in mind that he built in about a 10% overlap on where he expects the funding to all come from (40% Tesla, 40% Panasonic, 20% other suppliers, 10% local government). 10% is only 500 million, so if they get only 400 million from Nevada, then I think that is close enough and wouldn't keep them from executing on the deal assuming that all the other parts line up.
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  • Aug 19, 2014
    JRP3
    I think Reid is misinterpreting the quest for a good deal in order to keep costs down as being motivated by money. Musk is motivated by success, keeping costs down is a necessary part of being successful in this venture.
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  • Aug 19, 2014
    AlMc
    Money is way less important to EM/TM which is why he has indicated the speed in getting project done is the critical part. Cutting 'red tape'/reducing legal challenges....That is why I think Nevada is still in the lead unless the Cali legislature can come up with some magic.
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  • Aug 19, 2014
    Model 3
    "it takes one to know one" ;)
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  • Aug 19, 2014
    Jackl1956
    Politicians, they all seem like game show hosts to me.

    Sting
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  • Aug 21, 2014
    theganjaguru
  • Aug 21, 2014
    chickensevil
    This has been mentioned before and the only connection would be a software joint venture or possibly Apple being a customer of their stationary storage market.

    Apple would in no way benefit from the type of batteries being made there. They don't and can't use the cylindrical form factor because they have products that are super thin. Could you stick an AA battery in the dimensions of your phone or tablet? Most laptops aren't even thick enough anymore (and certainly not an Apple laptop)...
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  • Aug 21, 2014
    JRP3
    I agree, though it would not be any burden to have one or more lines winding a different format.
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  • Aug 21, 2014
    chickensevil
    Although cylander is relatively easy to change I thought the square types were not that easy and going from cylander to square isis a totally different animal, no?

    And correct me if I am wrong but Apple uses square cells right?
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  • Aug 21, 2014
    techmaven
    There are at least two obvious things that I think Apple and Tesla might have a common interest. Then there are a few others that are more, well, out there.

    One is that Apple has a big commitment lowering their carbon footprint at their various facilities. They have a huge solar farms at their data centers in the U.S., and they use fuel cells too. Tesla's battery based energy storage systems would definitely be interesting to Apple, especially with the new California spaceship headquarters being built now.

    Second is the CarPlay integration into Tesla's infotainment system. There is obviously big demand to get that done and it isn't necessarily clear how to go about doing it on Tesla's side.

    Beyond that, there are always possibilities of joint ventures like future infotainment based on iOS, technology sharing, or product design. I do think that if Apple really thought outside the box, they could buy Tesla outright with cash. The automobile is another computer gadget now. Apple's purchase and subsequent investment of cash could definitely accelerate the adoption of EVs around the world. It's not clear that Apple has a better use of that cash. They have about $164 billion in cash now (a lot overseas, but so what) and Tesla's market cap is a mere $32 billion. Add a ~20+% mark up and we're talking $40 billion or less than 25% of their cash horde.
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  • Aug 21, 2014
    ecarfan
    Elon is not going to sell Tesla anytime soon. He's on a mission. It's not about the money.
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  • Aug 21, 2014
    adiggs
    I'm assuming that you're a shareholder - if Apple made an offer to Tesla shareholders for a 20% markup on the shares (say we're at $250 - Apple offers you $300 for your shares), do you tender your shares?

    I don't.

    Not that my shares will swing a shareholder vote one way or the other you understand, but a 20% markup doesn't get me to part with mine.
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  • Aug 21, 2014
    techmaven
    Certainly not about the money in the sense of short term personal financial gain. However, if Apple wanted to, they could make a compelling case that they can push the BEV future faster and further than Tesla could by itself in the short term. Tesla has the current distraction of the stock price and the issues with staying non-GAAP profitable in the short term. As part of Apple, those issues might be mitigated. Imagine starting Tesla Gigafactory #2 and #3 right away. Imagine quadrupling the current Supercharger install effort. That might sway Mr. Musk into selling. Plus, he could still be a consultant and spend more time with SpaceX. I'm not advocating this in particular, but it is a plausible scenario.
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  • Aug 22, 2014
    sundaymorning
    Plausible, but very slim before Gen 3 becomes a reality. In order for a brilliant guy like Musk to go down in the history books as the Henry Ford of our time, he needs to cement his legacy by creating a compelling mass market car that would become known as the car to change the world. IMO a man like Musk is out there to cement his legacy and he is only 3 years away from doing just that, if you were Musk would you sell something that priceless? One can buy Musk years ago when he was running Paypal, but not now, he's not in it for the money. Running one company that changes the world is good stuff, but doing two simultaneously is legendary and that is why we look up to him that much more.

    No sell, come back in three years or more!!!!!
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  • Aug 22, 2014
    JRP3
    Some machines can actually wind both cylindrical and pouch cells, but my point was that with such a large factory running multiple lines some machines could easily be setup for pouch production. Some of the line machines are format independent anyway, such as slurry mixers.
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  • Aug 22, 2014
    dalalsid
    I'd vote no on any takeover that is <40% premium to ATH. Plus I would not like Apple taking over Tesla anyway. Google maybe, Apple not.
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  • Aug 23, 2014
    Jackl1956
  • Aug 24, 2014
    theganjaguru

    Open your mind. Your analogy is like saying a wedding cake shop couldn't make cupcakes because of the size of cupcakes and the fact that cupcakes wouldn't work for weddings. The bigger point is that the ingredients for cupcakes and wedding cakes are basically the same. - The wedding cake maker has all the tools and ingredients to make cupcakes, they only need the right pan to bake those cupcakes....

    The same is true with Tesla's batteries vs Apple Batteries. Apple uses the form factor for design and Tesla uses the automotive grade for maximum energy density, but the main ingredients are largely the same.

    Elon Musk talks battery tech Apple iPhone engineering manager - YouTube

    By your analogy Tesla would only be able to build one kind of car on their production line, but they've shuttered it to be able to manufacture two different models on the same line.


    The goal is cheap batteries, part of that goal requires economies of scale. It is the ingredients in the battery that are expensive, not their shape. It seems much more logical that this factory would produce batteries that are lithium ion in chemistry, shape being negligible as it effects energy density more than the cost to manufacture...

    If this factory is going to be as state of the art as it's been advertised to investors, then they should easily be able to make batteries for anything.. Yes possibly a second production line, but the demand is there as that apple engineer in the video above stated.... Plus we know that meeting with Apple (back in Feb) was more likely talk about the gigafactory and not a merger...


    Tesla CEO Elon Musk confirms talks with Apple, battery discussions more likely than acquisition | 9to5Mac

    - - - Updated - - -

    I definitely agree that they have parallel goals.... Definitely need a place to store any extra energy or provide a battery backup to allow their facilities to function off grid..... Or a cheaper supplier of American made batteries for their products..... I would not be happy if Apple bought Tesla. I am an apple fanboy, but would not like it if they bought Tesla......
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  • Aug 24, 2014
    chickensevil
    I just think you all are being overly ambitious about all of this. Even IF they wanted to allocate a separate line for an alternative shape design (pouch instead of cylinder), why would they? It has been stated many times that the factory would be for new cars and their stationary storage. If they are planning to make 500k cars from the factory at 85kW packs would leave only 7.5GW of batteries left over. The factory itself is only doing 35GW. So lets assume then that they have 7.5GW to play with, how big is the stationary storage market going to be in 2020? There are already estimates out there that (not counting residential use) it would be a 400Bn market by 2020. Why would they not take every single on of their leftover batteries, package them into their stationary storage and sell those?

    Maybe down the road with factory 2 and 3 they might branch out further... depending on the uptake of their cars and the stationary storage. But thinking about them making batteries for other purposes would be negative toward the company because then you are saying that they don't have a big enough market for their cars so they are selling off their excess to other people. Plus at some point they will build a second factory... I would guess this factory will go into construction sometime between 2017-2019, and then all excess cells that might exist in the factory would then be tied up 100% through cars.

    It isn't that Apple wouldn't potentially benefit, I'm sure they would... same as any other company who needs batteries in their products, which is just about any electronic device maker out there, but for Tesla to pull away from their limited supply in order to support such a small market (which in terms of power storage... it is small... By Galaxy S5, which has a rather large battery for a phone, is only 10.78Wh, and let's say they supply power for all of the entire new cell phone market (about 1674.4 Million units per year) this comes out to 18.05GWh. Batteries for these markets are razor thin on the margins... and most phones don't likely have as large of a battery as my phone has. So while yes, they could theoretically supply batteries for Apple, and Samsung and Nokia and LG and still not break past that 7GWh of left over power... you are talking about making uniquely fitting batteries, in an off form factor (these are all pouch, all different sizes, all different power outputs, etc) all to make a couple pennies on the dollar for each sale? hardly seems worth it...

    Instead you are talking about pushing the prices down for autos into the 100$/kWh range to make cars competitive with ICE (on a product that they are overall already making 28% on, if they reduce the price of their most expensive component from 16k$ to 8k$ you just added an extra 8k$ GM on top of the already 28%. Then tackling the stationary storage market which for a 30kWh system you are talking about something on the order of 150k for the power bricks or 20k for lead acid (which doesn't last but like 5 years), instead move to something that should last at least 7 years for around 5k$ total? They could easily hit a 25% margin on the early days of stationary storage and make a lot more money.

    From a purely money making standpoint, Tesla stands to make more money sticking with Cars and Storage than they do quibbling over a couple pennies coming out of your cell phone. The ROI on that would be enormous!

    - - - Updated - - -

    For one more thing to chew on at 250$/kWh taking my cell phone battery again... you are talking about 2.70$ for my battery... Hardly seems like Samsung and Panasonic are making out really well on this venture... which probably explains why they aren't... and why until Tesla came along Panasonic was deep into the red on their battery segment of their company.
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  • Aug 24, 2014
    roblab
    While I wait, and wait, for a better solution to power storage, I am using Absorbed Glass Mat Sealed Lead Acid. No leak, no fill, no maintenance. With a system that keeps them charged (at present using Outback) the life estimate is *eighteen* years, not 5. I have had mine for 12 at present. Used then this morning right after the earthquake when the power clicked off.

    I paid roughly $350 each for eight batteries ten years ago. Today they are about $500 each. With shipping. I figure that's about $4000. Not 20K. For about 30 kWh. I didn't see how much you were using.

    Just a point of reference. Just my experience.

    I definitely agree that Tesla can use every battery they make for their own products.
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  • Aug 24, 2014
    Robert.Boston
  • Aug 25, 2014
    LakeForest
    Anyone hearing peeps about California's incentive package? If they are going to pass a bill my understanding was it would/should be passed by Friday, before they go out on recess in order to meet Tesla's decision timeline. Would be interesting to see what they offer, could be rather large and a nice catalyst to the stock.
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  • Aug 25, 2014
    Jackl1956
    Is California too Green for Tesla's Gigafactory

    LA Times

    I haven't been able to pick up on anything from the legislature yet.
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  • Aug 25, 2014
    chickensevil
    It's terrible, because now, just about anyway Tesla rejects CA (if it does) it will seem like they are trying to skirt the Environmental Regulations as the reason for turning its nose up... nevermind that it is about the time issue more than anything. They can't sit around for 6 months waiting for someone to choose to complain about a potential impact all to just hold up the process and slow Tesla down. If I was big oil or some other huge anti-Tesla group I would spin this as much as I could.

    Headline: Tesla avoids CA due to Environmental reasons (their name is smeared, tons of bad press, etc, none of it true of course)
    Headline: Tesla factory delayed... again... amid concerns that lithium this close to a water supply could be harmful to children (just making some crap up here... but the person behind that allegation would of course be someone out to keep the factory from opening quickly...)

    I just see this brewing up as a lose lose situation, and the least loss option likely will be to just avoid CA altogether at this point and just tell the public that they couldn't get CA to move fast enough for us, and this was why we didn't have them as a choice from the start. CA government is too slow... push that message as much as possible, and they should be fine... but then turn around and back it up with "but Gigafactory number 2 will be in CA for sure!"
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  • Aug 25, 2014
    JRP3
    I don't really agree, I think the actual announcement and start of construction overwhelms all such weak FUD attempts and TSLA keeps plowing ahead.
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  • Aug 25, 2014
    Jackl1956
    Consider a win-win situation. California enacts legislation, providing Tesla with $500 million in tax incentives while streamlining CEQA regulations to speed construction and ensure environmental protections. Legislation which dovetails perfectly with California's global warming initiatives and "Stationary Storage Mandate".

    The FUD is a certainty. Texas has thrown down the gauntlet, will California meet the challenge? Will see.

    Brown Administration to potentially waive environmental laws for Tesla Motors
    �
  • Aug 25, 2014
    AlMc

    Jack.....I would like to see the GF in California, but the environmental groups and their lawyers and the general litigious nature of some in the state scares the heck out of me. I see Brown/legislature passing a law and giving generous incentives to TM only to see all of those challenged in court and appeal after appeal. I don't see the litigation issues in Nevada and Texas. It has always been my position that TM's heart says California but their 'head' says Nevada (for proximity) or Texas (for generous incentives/ready work force). If I were TM I would start two GFs. One in Cali and one in another state. The Cali one will be slowed for years while the other is operational in 2-3 years. As TM brings in more money they complete the Cali one in 2018-19 when they finally clear the legal hurdles.
    �
  • Aug 25, 2014
    chickensevil
    +1 I haven't really taken sides on the issue until now. But unless some miracle happens I just don't see them going with Cali. That was why I also said they should press for factory number 2 to go there and then look to make the second car factory wherever is closest to their first battery factory. Then you aren't moving supplies very far at all.

    Third factory for both cars and batteries in Asia somewhere... Likely China... But I don't think they want to rebrand their car in other Asian countries... Who knows? And then 4th factory in Europe somewhere. At that point it will likely shift into specialized factories for specific products. Like a truck factory or an SUV factory. Anyway, getting ahead of myself...
    �
  • Aug 25, 2014
    Robert.Boston
    The California legislature created CEQA; the California legislature can bypass it. I can't see what possible issue could be raised to California court if a pro Tesla bill were in fact passed.
    �
  • Aug 26, 2014
    Model 3
    Elon has already hinted about a truck factory in Texas. ... if they let Tesla sell cars there :p
    �
  • Aug 26, 2014
    Jackl1956
    At the end of the day, California and Texas are the only two states with economies large enough to enact $500 million in tax subsidies. For this reason alone, the states of Arizona, Neveda, and New Mexico will probably end out of the running.

    The competive angst that exists between Texas and Caifornia, (Governor Perry actively recruiting California businesses, i.e. Toyota) has become the catalyst for the competition for Tesla's Gigafactory. Governor Brown, and state Senators Steinberg, and Gaines have teamed up to respond to the challenge from Texas, expect California to put together one helluva of a proposition.

    In California's favor is a history of legislation which is in concert with Tesla's corporate mission of a "Solar Electric Future". Specifically, they enacted legislation to address Global Warming, Electric Vehicles, and Stationary Storage. The Gigafactory fits perfectly into Californi's vision for the future.

    My prediction is that Tesla will announce two locations, the first in California and the second in Texas. Elon will make the Texas Gigafactory contingent upon the passing of legislation legalizing direct sales. If Texas were to do this it would set a tremendous example for the rest of the country.
    �
  • Aug 26, 2014
    AlMc
    All due respect to you and no offense to TMC in the legal profession: Lawyers can tie up things for years if you have an individual or group that has the money to pay them. Just because the executive and legislative branches agree on a bill does not mean that the judicial branch will go along/not accept challenges. I do not have a graph/study/report that shows the most 'suit happy' state overall but based on my own profession I know that malpractice insurance in California is the highest in the nation.
    �
  • Aug 26, 2014
    Cattledog
    This made me think of a complex but potential work around for the Texas Legislature and Tesla (BTW, all for Texas dropping draconian laws, just getting creative here and spending other people's money). What if the repeal of the Texas law came with the stipulation that auto manufacturers could sell directly to consumers in the state if they manufactured cars in the state? Would be an end-around, I know, but perhaps it brings a few warring parties together to get the Gigafactory, and a car/truck factory, to come to Texas.
    �
  • Aug 26, 2014
    bollar
    Many manufacturers already have factories in the state, so I don't see that happening. IMO, more likely to exempt US EV or alternate fuel manufacturers.
    �
  • Aug 26, 2014
    Cattledog
    Sure, could add stipulation that cars are alternative fuel vehicles to work around things. I know it ain't gonna happen, but it would be worth that level of willingness to try something bold to get a Gigafactory and car factory.
    �
  • Aug 26, 2014
    bollar
    I think we have a good chance of something being worked out in the coming legislative session. Maybe it will be a lame "Tesla can have up to five stores in the state" type of resolution, but I don't think the Texas law will go unchanged in the coming year.
    �
  • Aug 26, 2014
    JRP3
    That will be too late for the GF.
    �
  • Aug 26, 2014
    bollar
    Yes, and I'm okay with Texas being removed from consideration if that's the way the timing goes. Then again the second week of January isn't that far away...

    The alternative would be for the Governor to call a special session of the legislature to consider the issue, or maybe issue an executive order. Perry's a lame duck, so maybe he doesn't care about the political implications, but I expect an executive order would be challenged in the courts.
    �
  • Aug 29, 2014
    hobbes
  • Aug 29, 2014
    Jackl1956
  • Aug 29, 2014
    chickensevil
  • Aug 29, 2014
    roblab
    It is if you have to wait til then to get your new Tesla built, because they can't get batteries!!
    �
  • Aug 29, 2014
    TexasEV
    The Texas franchise law does not leave any room for interpretation or allow for any discretion in how it's enforced. NADA uses it as a model for other states because it's bulletproof. There is nothing the governor could do.
    �
  • Aug 29, 2014
    Jackl1956
    SACRAMENTO � Senator Ted Gaines (R-Roseville) today issued the following statement regarding California�s efforts to attract the Tesla Motors �gigafactory� to the state.
    �California has already kicked in hundreds of millions of dollars to help get Tesla off the ground and that alone should tilt the field in our favor for the gigafactory.
    �I am going to do everything I can to bring this $5 billion investment and the 6,500 jobs that come with it to this state, but Tesla has to give the state a straightforward understanding of their intentions.
    �With hours left in the Legislative session, I�m disappointed we haven�t sealed the deal. California�s effort is not to blame. When Tesla is ready to come to the table, we are ready to listen and will do all we can to bring the battery factory to our state.�

    I am disappointed in the state legislature of California.
    �
  • Aug 29, 2014
    apacheguy
    IMO, California has done plenty to attract the interest of Tesla. From the bottom all the way up to our outstanding Governor's office. I applaud my state's efforts. The ball is in Tesla's court.
    �
  • Aug 29, 2014
    Robert.Boston
    I agree -- it sounds as though the key legislators have done everything they could reasonably do. Tesla needs to come up with its wish-list.
    �
  • Aug 29, 2014
    Jackl1956
    The California legislature just approved $420 million dollars in tax incentives for a defense industry contractor. The United States spends more on defense than the next 22 countries combined. Almost all of which are our allies.

    Should the have stepped up for Tesla? Damn straight.
    �
  • Aug 29, 2014
    Robert.Boston
    As near as I can tell, the barkeep is waiting for the customer to place an order, busily wiping the glass clean. If the customer doesn't order a drink, you can't blame the bartender for not serving one.
    �
  • Aug 29, 2014
    Lump
  • Aug 29, 2014
    MikeC
    But there are four other barkeeps there and one of them has already started making a drink. It wouldn't hurt for California to try to offer a tastier drink for a cheaper price to get some business.
    �
  • Aug 29, 2014
    AlMc
    +1.. To continue with the analogy. The customer has asked the four barkeeps to make their best drink and the customer will choose which barkeep to bring all his business to based on that drink. The customer also has to keep in mind if one or more of the barkeeps has to worry about any temperance movements that might delay or hinder him from continuing to make the drink.

    OK..I'll stop.

    �
  • Aug 29, 2014
    apacheguy
    I think it'd be helpful if you could provide a description of what the other 3 bartenders have on their menu. I'm not exactly clear as to what the other states have explicitly done to pave the way for the gigafactory.
    �
  • Aug 29, 2014
    Jackl1956
    In a perfect world, incentives would not exist and innovation and creativity would drive economies. Since our world is dominated by polical action committees, and hired guns like Jack Abramhoff it aggravates me political action committees step up in a loud and clear voice to decry Tesla's battery factory, yet muffle any response to oil company or defense industry businesses.
    �
  • Aug 29, 2014
    pz1975
    It think this is just posturing during the negotiations. Probably means a deal is imminent with CA.
    �
  • Aug 30, 2014
    hobbes
    Looks like unfortunately not:
    California Lawmakers Set to Adjourn Without Tesla Aid - Bloomberg

    This gives more background info:

    From the article:
    My guess is it's going to be Texas after all.
    �
  • Aug 30, 2014
    chickensevil
    Well yeah, if they are going to force Tesla to lock in CA and they haven't even passed the legislation or committed to them getting the plant online quickly then of course they aren't going to agree to that.

    I don't think the incentives are nearly as important as time is. Tesla wants this online fast and I don't think they are going to care if they get 300M or 500M they just want to be cleared to build and come online before 2017. It seems CA is not going to do that so it will likely be a pass. I still think Nevada will be the winner since they clearly can do things in that state without the government getting in the way.
    �
  • Aug 30, 2014
    Curt Renz
    If an offer is not made by the California government, then it would be cutting off its nose to spite its face. Not passing a bill would guarantee the Gigafactory will be built elsewhere. Passing one gives California a fighting chance. That's much better for them than no chance. Wise legislators should be able to understand this.
    �
  • Aug 30, 2014
    doggusfluffy
  • Aug 30, 2014
    AudubonB
    There appears not to have been a beep or a bleep or a peep out of NM or AZ for the longest time.

    Suggests to me those two states thus have to be the front-runners! :-D
    �
  • Aug 30, 2014
    hobbes
    San Jose Mercury News writer Dana Hull (danahull) on Twitter :

    Too bad, would have given me a chance to trade on Monday (in Germany) before NASDAQ opens again. Hm, do you think stock will be down if there is no GF announcement?
    �
  • Aug 30, 2014
    chickensevil
    I wouldn't think so, I really don't believe that was the reason for the pop in the price. There was no expectation of an announcement all we knew was that if CA was going to make progress it would happen this week. But there are still other states in the running so I wouldn't expect there to be a hit... I would hope the stock would keep going up because we are through the resistance.
    �
  • Sep 3, 2014
    tlo
    This from my news feed:


    Tesla said to select Nevada for gigafactory, DJ reports.
    �
  • Sep 3, 2014
    Joel
  • Sep 3, 2014
    FredTMC
    I hate that no sources are named yet on the GF Reno news. I want something official...
    �
  • Sep 3, 2014
    chickensevil
    CNBC is citing they have "Tesla" sources confirming... for whatever that is worth. With Dow Jones and Wall Street Journal reporting it as well, I feel pretty good.
    �
  • Sep 3, 2014
    apacheguy
    So what welcome package did the Nevada legislature draw up to land them the deal?
    �
  • Sep 3, 2014
    Lump
    The electric carmaker is still hammering out the specifics of a contract but the deal is a "go," CNBC cited one source from the Nevada governor's office as saying.
    �
  • Sep 3, 2014
    AlMc
    My feeling is that since EM has stated several times that the most important thing for him was speed in development THAT is the incentive Nevada provides. I bet Cali and Texas have money $$ incentives but Nevada's proximity to Freemont, low/minimal taxation and little environmental/legal delays won the day.
    �
  • Sep 3, 2014
    apacheguy
    I suppose I just find it interesting that they had a legislature bending over backwards to roll out the red carpet and they chose the state that has essentially done nothing but stay it's course. CA was willing to forego several key CEQA regulations in order to speed construction. Why would they have said no to that?

    Especially down the road, even after the factory has been built (thinking long term ramifications here), I would take more comfort in knowing that I operate in a state that backs my business 100%. Maybe there was something else to the deal so I look forward to reading the press release. But simply choosing a state because they have no environmental safeguards is a bit shortsighted and not considering the long term, IMHO.
    �
  • Sep 3, 2014
    MikeC
    CA killed it last week when they couldn't get an incentive package passed before the legislative session ended. Serves them right. Hope they learn their lesson when it comes time to try to get GF2.
    �
  • Sep 3, 2014
    AlMc
    My opinion, based only on my own profession.....California has some of (if not the) the highest rates for malpractice insurance. Many friends of mine love the state...to retire to....but would not practice there...too many law suits. I think TM will eventually build a GF in Cali...but even if they start building one in Cali and Nevada at the same time the Nevada one will be open and running 12-18 months sooner. There are fewer impediments.
    �
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