Print 46 comment(s) - last by Morlarl.. on Apr 15 at 7:41 PM

Gov. Rick Perry  (Source: Bloomberg)
He said the pros of allowing this would outweigh the cons

Not long ago, Texas told Tesla Motors to take a hike when the automaker wanted to sell its electric vehicles (EV) directly to customers without the use of auto dealers. But it seems that the Lone Star state is changing its tune now that Tesla's giant Gigafactory is on the line. 
According to Dallas News, Gov. Rick Perry (R-TX) indicated that Texas needs to take a second look at its state rules -- which he referred to as "antiquated" -- that prevent Tesla from selling its EVs directly to customers. 
"Tesla’s a big project,” said Perry. “The cachet of being able to say we put that manufacturing facility in your state is hard to pass up.
“I think it’s time for Texans to have an open conversation about this, the pros and the cons. I’m gonna think the pros of allowing this to happen outweigh the cons.”
Perry wants Tesla's Gigafactory, which the automaker plans to build in a Southwest state in the U.S. The factory aims to supply batteries for up to 500,000 EVs by the year 2020. The gigafactory would cost $5 billion USD, span as much as 1,000 acres, and employ about 6,500 people. It would also largely be powered by renewable energy. 
Four states -- Texas, Arizona, New Mexico and Nevada -- are pushing to become the site for the Gigafactory. Whichever state Tesla chooses will see great economic benefits from the large-scale plant; hence Texas' new view on direct sales.
The state realizes that Tesla likely won't choose it if Texas doesn’t allow the automaker to sell its vehicles without the help of auto dealers. 
It's possible that Tesla CEO Elon Musk is using the Gigafactory as leverage to get the direct sales laws changed in certain U.S. states, and it looks to be working as Arizona recently passed a bill to allow Tesla to do just that.
Texas Rep. Jason Villalba (R, Dallas) recently wrote Musk a letter in an attempt to patch things up with the automaker. He said he's a proponent of the Tesla-backed House Bill 3351, and that Texas is the perfect state for the Gigafactory due to its warm climate (for the solar-ran factory) and large labor pool to fill factory positions.  
Earlier this month, New Jersey Gov. Chris Christie’s administration proposed a new rule that requires a person to have a franchise agreement with an auto manufacturer in order to be granted a license to sell. Tesla already had two stores in the state at the time. 
Shortly after, the New Jersey Motor Vehicle Commission voted in favor of the ban of direct auto sales. This means that the two stores must be turned into showrooms and nothing more after April 1, 2014. 
New Jersey is now the third state to ban Tesla's direct sales model. 

Source: Dallas News

Comments     Threshold

This article is over a month old, voting and posting comments is disabled

RE: I find it hypocritical
By retrospooty on 3/25/2014 10:18:55 AM , Rating: 2
California has an extremely high wage level, so building something like a factory to make batteries with mostly low end manufacturing jobs isn't cost effective.

RE: I find it hypocritical
By Jeffk464 on 3/25/2014 5:49:58 PM , Rating: 2
Not really, CA has a very high cost of living and public unions have gotten themselves insanely good pay packages, but low end jobs don't pay any better than anywhere else. Basically if you don't have a high power job its time to move out of the state.

RE: I find it hypocritical
By retrospooty on 3/26/2014 8:03:05 AM , Rating: 2
" CA has a very high cost of living "

That is what I am saying. high cost of living, high rent/property value + high wages balances out somewhat for people that live there, but for a business it doesn't.

RE: I find it hypocritical
By Mint on 3/26/2014 1:49:25 PM , Rating: 2
This is going to be a very modern factory. Direct wages for production workers aren't going to be a significant factor, because it'll be heavily automated. 6500 jobs is not a lot for a $5B factory. Even if locating in the boonies of CA means a $5/hr premium over Texas (unlikely), that's only $65M/yr, or $1-2 per kWh.

The big economic effects are going to be from building all the equipment that Tesla will buy, and that'll probably come from many places.

The main reason not to locate in CA is probably land cost. It's also a waste of publicity, as Tesla would love Texans to feel local pride for their cars. Tesla sold 1/3rd of their 2013 production in CA, and Texas is the second largest state.

"We’re Apple. We don’t wear suits. We don’t even own suits." -- Apple CEO Steve Jobs

Most Popular Articles5 Cases for iPhone 7 and 7 iPhone Plus
September 18, 2016, 10:08 AM
No More Turtlenecks - Try Snakables
September 19, 2016, 7:44 AM
ADHD Diagnosis and Treatment in Children: Problem or Paranoia?
September 19, 2016, 5:30 AM
Walmart may get "Robot Shopping Carts?"
September 17, 2016, 6:01 AM
Automaker Porsche may expand range of Panamera Coupe design.
September 18, 2016, 11:00 AM

Copyright 2016 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki