- Tesla’s newest factory could likely be headed for Austin, Texas.
- While Tesla hasn’t Tesla announced its final decision, it proposed a 5 million square foot plant in Austin that would eventually produce its much-hyped Cybertruck and result in about 5,000 jobs in the area.
- But in a heated public meeting, labour advocates and citizens sparred over the incentives laid out by Travis County.
- Visit Business Insider’s homepage for more stories.
Tesla is zeroing in on Austin, Texas for a new Gigafactory to build its Cybertruck and even a new headquarters.
Nothing is official yet, but the electric automaker has made its case to local officials in the Texas capitol as to why it should receive some $US7 million in tax relief from Travis County to locate there. And in a public meeting on Tuesday, company executives and economic development officials pitched a deal that could see Elon Musk hire tens of thousands of workers.
But of course, nothing the company does comes without criticism and, in many cases, a fight. While dozens of citizens wrote and dialed in to support the new factory and resulting jobs, plenty of others voiced concern over what have been, in their view, past grievances by Tesla and “billionaire playboy” Musk.
Here’s Tesla’s pitch:
As Business Insider reported earlier in June, Tesla has filed a land-use application for a plot of land near Austin’s airport that’s currently a concrete and mining operation. The company, in conjunction with county officials, reached an agreement for massive tax refunds, and presented it for the first time at the public meeting.
Under the terms of the not-yet-final deal, Tesla would get about $US1.64 million in tax rebates over the next decade, with the county still receiving $US7 million, in exchange for $US1 billion in new investment. Tesla officials touted plans to hire more than 5,000 workers for the 5 million square foot plant, in a move that could attract new companies that supply Tesla’s components to the area.
Rohan Patel, Tesla’s senior director for global business development and public policy, said there were three main reasons why Austin caught the company’s eye: availability of workers, partnerships with the local school district for talent, and the site’s riverfront location.
“There’s great potential for recreation and beauty,” he said, “in transforming the old mining site into a sustainable factory with recreation opportunities. That’s a vision that fits perfectly with our mission.”
Another Tesla executive, HR chief Valerie Capers Workman, said the company’s first hire after inking a deal would be to hire a community liaison to ensure a seamless integration with the local surroundings. She also touted partnerships with the school district near Tesla’s Nevada factory and with criminal justice reform advocates.
“Unlike other tech companies who come in and have to make up programs and build it on the fly,” she said, “I’m talking about programs that are already established and things we’re already doing in the community.”
Community members and current Tesla employees phoned in to voice their support for Tesla’s arrival and the deal with Travis County.
“This is an opportunity to make sweeping, generational change,” one person said. “If they open a plant here I’ll certainly buy one.
Another attendee told the leaders to “invest with capital in the future that you want.” And three Tesla employees called in to say how much they love their jobs.
“As a service technician at the Austin Pond Springs location,” one said, “I have excellent, affordable health care, dental, and vision. At my previous employer it would have taken me eight years to accrue this much time off.”
Tesla said in its presentation that most of the jobs at the factory are low-skill, requiring only a high school degree, and have a wage floor of $US15 an hour – double the state’s minimum wage. Median salaries would be $US68,303 annually, Tesla said.
Plenty of other citizens phoned in to warn officials against what they perceived as past deception by Tesla, and to urge them to require the company pay all of its taxes, given its $US181 billion market cap and billionaire boss.
“It’s too easy to find when Tesla has broken the law continuously,” said a student attendee. “You can Google it. Elon Musk has repeatedly put his workers at risk.” In May, Musk tussled with local official in California, opening Tesla’s factory amid shelter-in-place orders, which resulted in multiple workers getting sick.
Labour advocates pointed to instances of “union busting.” In 2017, a judge ruled in favour of the National Labour Relations Board, saying Musk and Tesla broke the law by threatening and retaliating against workers attempting to unionize. The company was required to offer a fired worker their job back and revoke a formal warning given to another.
“We’ve said all along that ultimately it’s up to our employees to decide they want union representation,” Tesla’s workman said. “We’ve awarded contracts to multiple vendors that are union vendors.”
But it did little to assuage concerns.
“I urge you to, at a minimum, at least pay the county’s own living wage,” said one attendee. “Do not just view Texas as a cheap labour and anti-union region. It will enshrine a race to the bottom here.”
MIT’s living wage calculator estimates the living wage for a single working adult in Travis County to be $US25.70 per hour. Housing in Austin is some of the most expensive in Texas after experiencing some of the nation’s highest population growth for years.
“I heard someone in this meeting say they have never heard anything bad about Tesla,” one attendee said, “and respectfully, I’d ask where have you been? Elon Musk has a net worth of $US42 billion. If he wants a rebate I suggest he use his own money. Tesla will cut every corner when it comes to worker pay and dignity standards. When they back out of the agreement like they did in Alameda, they will do so with better attorneys than we could ever afford.”
Tesla did not immediately respond to a request for comment on the meeting minutes.
It’s unclear when Tesla might make a decision between Austin, its other close contender of Tulsa, or another site. Construction in Austin could begin as soon as August – and “is all but a done deal,” one source told the Austin American Statesman.
When anything is announced, there’s a good chance it will be on Twitter.