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Tesla Model S
The tax break is for new manufacturing equipment worth up to $415 million

The Golden State is giving Tesla Motors a hefty tax break in order to up its production of clean vehicles. 

According to SFGate, the state of California is giving Tesla a $34.7 million tax break on new manufacturing equipment worth up to $415 million. This eliminates sales and use taxes on such equipment, giving the automaker a helping hand when it comes to production of electric cars and powertrains. 

This exemption will help increase Tesla's annual production by 35,000 cars. It currently expects to deliver 21,500 Model S' this year. 

The tax break and purchase of new equipment will also add approximately 112 new jobs at Tesla. This, coupled with increased EV sales, is expected to return a $24.4 million net benefit to the state of California.  

California is currently one of the few U.S. states that tax the purchase of manufacturing equipment. However, the California Alternative Energy and Advanced Transportation Financing Authority can give exemptions to clean-tech companies. 

This is great news for electric vehicle maker Tesla, which is based in Palo Alto and has a factory in Fremont. But this isn't the first time the automaker received the exemption. 
 
Tesla was granted exemption before on equipment worth up to $612 million, which helped it retool its Fremont factory and launch the Model S. The exemption will also help launch the Model X crossover SUV.
 
This is a great way to close one heck of a year for Tesla. The company already successfully paid off its $465 million government loans nine years early back in May, pulled a surprise profit for Q2 2013 with a revenue of $405.1 million, unveiled new tech for its Model S (such as swappable battery tech) and the Model S even snagged the highest safety rating from the NHTSA.
 
The company's only real hiccups have revolved around the three Model S fires throughout October and November of this year, which resulted in an investigation from the National Highway Traffic Safety Administration (NHTSA).
 
But that isn't stopping Tesla CEO Elon Musk from fighting for his EVs. He's currently battling auto dealerships around the country in an effort to sell his vehicles directly to the consumer, which he believes will be a better business model for the company. 

Source: SFGate





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