Which State will help Telsa Motors Inc. (NASDAQ:TSLA) in realising their dream?

Telsa Motors Inc. (NASDAQ:TSLA) wants to produce enough batteries which will power 500,000 cars per year before 2020. How do you expect they will do that? By building a $5 Billion factory in the middle of a desert! Nevada’s leaders have promised some hefty economic incentives to make sure the factory brings the 6,500 projected jobs to their state, at an industrial park just outside Reno which more than a century ago was constructed as a small railroad town. Equal in size to 174 fields of football, construction of the 10M square feet factory would bring immense prosperity to the state beginning with construction and turning into factory jobs when the plant starts running in 2017.

The promised incentives are what made Telsa Motors Inc. (NASDAQ:TSLA) executives pick Nevada over California, Texas, New Mexico or Arizona. The end product in mind makes it possible to take regular daily trips with only a single charge, provided ofcourse those trips consist of miles not going beyond 200. This Model 3 will be made in the ‘gigafactory’ where Telsa Motors Inc. (NASDAQ:TSLA) plans to produce the batteries on a large scale to bring the per battery cost down.

So how much exactly did Governor Brian Sandoval offer Telsa Motors Inc. (NASDAQ:TSLA)? His office won’t comment but based on CEO Elon Musk’s statements we see tax breaks and grants totaling around $500 Million or more. Do not think the other states are busy congratulating the governor. Busy in private biddings and negotiations the states are competing fiercely for the Telsa Motors Inc. (NASDAQ:TSLA) gigafactory. California state senator Ted Gaines R-Roseville, being the prime supporter of the gigafactory was not happy about losing it to Nevada. Admitted that Telsa Motors Inc. (NASDAQ:TSLA) was getting the states competing against each other solely due to their business savviness. Seems like he was banking too much on their working history with Telsa(TSLA).

Apart from the monetary incentives offered, Nevada has an infinite supply of sunshine and wind power which can be converted into green energy. Also, the industrial park is 200 miles from Telsa Motors Inc. (NASDAQ:TSLA) assembly plant in SF. The most important however is being near a natural deposit of one of the most important raw materials in battery production: Lithium. Having started excavation already at the Reno Tahoe center, the company still has not committed publicly to choosing Nevada for the gigafactory.

Telsa Motors Inc. (NASDAQ:TSLA) is not taking its chances however on Nevada entirely. If the governor fails to get the incentives approved from legislation, Telsa Motors Inc. (NASDAQ:TSLA) CEO Musk is prepared to invest in two or three sites before choosing which one will become functional. Depending on who comes through with the highest incentive package ofcourse.

Lets look at the stats now. Do they favor Telsa Motors Inc. (NASDAQ:TSLA)’S investment move? 40,000 fully electric cars sold, which last year was around 26,000 (Edmunds.com). Hybrid sales dropped slightly to a mere 3.6% this year. However, what gives Telsa Motors Inc. (NASDAQ:TSLA) encouragement is the new government standards concerning fuel economy which has to average 54.5 miles/gallon in new vehicles. THIS is what will really drive sales.