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Nevada Grants $1.3 Billion in Tax Breaks for Tesla Gigafactory

Motor Trend logo Motor Trend 9/12/2014 Karla Sanchez

Tesla recently chose Nevada as the future site for its Gigafactory battery facility, and if the company wasn't sure about its decision before, we bet it is now. Nevada Governor Brian Sandoval signed a deal that grants $1.3 billion worth of tax breaks, along with a measure allowing the electric car company to sell directly to state residents.

Nevada state officials unanimously agreed to write off Tesla’s sales taxes for 20 years and property and business taxes for 10 years. This means that Reno, the world's biggest little city, will soon be home to the largest lithium-ion battery factory when it starts running sometime in 2020.2013 Tesla Model S© Provided by MotorTrend 2013 Tesla Model S

The decision to have the Gigafactory built in Nevada wasn't a hard one for both parties, as we previously reported that Sandoval said the move would bring nearly $100 billion in economic impact to the region over the next 20 years. Tesla also wins from the deal, because aside from the tax breaks, Nevada lawmakers also exempted Tesla from the law that requires new cars to be sold through dealers.

Everything appears to be coming together, as Tesla finalized its partnership with Panasonic back in July. Panasonic will provide the manufacturing equipment and cylindrical lithium-ion cells needed to build the battery packs. The Gigafactory will help streamline production of battery packs and bring down their cost, and subsequently the cost of electric cars. Tesla CEO Elon Musk said the plant will be vital to the success of the Model 3, the brand's upcoming lower-priced EV sedan. 2014 Tesla Model S© Provided by MotorTrend 2014 Tesla Model S

The Model S and Model X, due later this year, will also benefit from the Gigafactory, as the plant is expected to cut battery pack costs by at least 30 percent. While Nevada beat out other states including Arizona, New Mexico, and California, all hope may not be lost since Musk has said the company plans to break ground on two sites in case there are any unforeseen days.

The Nevada site will reportedly employ as many as 6500 people after it opens up shop in 2020.

Source: Reuters

2014 Tesla Model S© Provided by MotorTrend 2014 Tesla Model S
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