Washington Tried to Land Massive Tesla Electric Car Factory — Would It Be Worth It?
News has leaked out in economic circles that Washington state Governor Jay Inslee tried to woo controversial electric car maker Tesla to build it's battery "gigafactory" in our state.
According to a noted New Jersey consultant who helps find "homes" for companies and new development, it was the most sought after economic development in North America.
Tesla, as Newstalk 870 has reported over the last two years, is a company started by Elon Musk, whose goal was to build a line of electric luxury and sports cars. Despite some exciting and racy designs, the firm hasn't exactly taken off.
But more on that in a moment. According to Public Broadcasting's KUOW-Radio:
"The Washington Department of Commerce said it mounted an aggressive effort that included the personal involvement of Inslee.
Several locations on both sides of the Cascades were considered.
Site consultant Boyd, who has worked extensively in Washington, said the state had a lot to offer Tesla - including low-cost energy. Also, Moses Lake is already home to a carbon fiber factory for BMW electric cars."
However, KUOW says there's at least one report that now says Reno, Nevada has been selected, and the company has broken ground there. The company would reportedly create 6,000 jobs to build batteries for a projected 500,000 Tesla cars to be built by 2020. Among the reasons given for Tesla's reluctance to locate here is that we're not a "right to work state." Controversial labor issues with Boeing and other companies have scared off some prospective companies. California is off their list because when CEO Musk announced they were on the "short list," The United Auto Workers union reportedly said they would try to unionize the Tesla factory workers if the plant were built there.
But beyond this grand project are some shady financial issues. Tesla's stock went up last year, and the company appeared to be growing. This despite Consumer Reports fiascos that occurred in testing some Tesla models - which either caught fire in the battery area, or the engines died and wouldn't restart just seconds into the test drive.
Front Page Mag online reports the real way Tesla has been making it's money is from government subsidies, and crony capitalism. According to Front Page:
"Tesla didn’t generate a profit by selling sexy cars, but rather by selling sleazy emissions “credits,” mandated by the state of California’s electric vehicle requirements. The competition, like Honda, doesn’t have a mass market plug-in to meet the mandate and therefore must buy the credits from Tesla, the only company that does. The bill for last quarter was $68 million.
Absent this shakedown of potential car buyers, Tesla would have lost $57 million, or $11,400 per car." (Bold lettering added for emphasis).
More from Front Page:
"Tesla isn’t actually making money selling cars. It’s making money from crony capitalist taxes of people who buy cars from other companies. And even the customers who buy its cars get paid with taxpayer money."
So, for every car they sell, the buyers receive numerous government, taxpayer funded rebates, kickbacks, and other financial compensation that eats up much of the cost of the car. And, as stated earlier in this story, millions are taken from other electric car makers to give to Tesla because they have "favored" status with the Obama Administration.
Wall Street experts say the company is also running on $150 million in borrowed cash from Goldman-Sachs, and has floated hundreds of millions in new stock and debt for investment in car building.
Does that sound like the kind of company we want thousands of people to risk working for?