Tesla taps Reno as potential Gigafactory site

It’s official: Tesla Motors has broken ground on a stretch of land outside Reno that could serve as the site for its forthcoming $5 billion battery factory.

But not so fast: they’re not the only one in the mix. In a letter to shareholders, Tesla CEO Elon Musk was careful in saying the Reno site “could potentially be” the location for the Gigafactory, expected to create 6,500 jobs.

“Consistent with out strategy to identify and break ground on multiple sites, we continue to evaluate other locations in Arizona, California, New Mexico, and Texas,” Musk wrote.

The news followed weeks of rumors naming Reno as the front-runner in a race to secure the plant.

A post on a blog called “Transport Evolved” recently reported activity at the Tahoe-Reno Industrial Center, a 106,000-acre site 9 miles east of Reno that currently houses tenants like Wal-Mart and PetSmart. Though speculation pegged the site to Tesla’s Gigafactory, it was unclear whether the company had broken ground anywhere — until Musk’s letter. Other standout cities include Stockton, Calif. and San Antonio, Texas.

Tesla expects to name the final site for the company’s first Gigafactory in the next few months, Musk wrote, “once we have full visibility and agreement on the relevant incentives and processes for enabling the Gigafactory to be fully operational to meet the timing for Model 3.”

Tesla’s Model 3 is the electric car-maker’s third car, set to hit the market in 2016 0r 2017 with a price of $30,000. Company officials have said they need to move quickly on the project so the Gigafactory can produce batteries for the new model and reduce its battery costs by 30 percent.

As part of a deal announced Thursday, the electric car king plans to eventually build the 10-million square foot battery plant with the help of Japanese electronics company Panasonic Corp.

In Nevada, economic development officials have remained tight-lipped about the any of the negotiations to persuade Tesla to set up shop in the Silver State, which harbors a 7.7 unemployment rate, the third highest in the U.S.

“Because of confidentiality, I am unable to provide you with any Tesla information,” wrote Jennifer Cooper, communications director for the Governor’s Office of Economic Development, in an email.

Others say the factory’s arrival here would be a major bright spot for Nevada’s economy, a chance for the state to emerge as major player in the manufacturing scene.

“It’s great news for the state,” said Robert Lang, UNLV director of Brookings Mountain West. “It would be big news in Texas. It would be big news in Arizona. But it would be the biggest news in Nevada.”

Tesla bosses have been interested in Reno as a potential site since it announced plans for the factory. The city offers favorable access to the state’s freeway and rail systems and Tesla’s headquarters in Palo Alto, Calif.

The Associated Press contributed to this report. Contact reporter Ed Komenda at ekomenda@reviewjournl.com or 702-383-0270. Follow him on Twitter @ejkomenda.