Dive Brief:
- California-based electric car company Lucid Motors has selected a site near Phoenix to build its new $700 million plant, according to the San Francisco Chronicle.
- Lucid, which began as an electric car battery company called Atieva, expects factory construction in Casa Grande, AZ, to begin in the second quarter of 2017 with the first cars complete in late 2018. The company said its cars will have 1,000 horsepower, 400-mile battery range and more space because of its ability to reduce the size of vehicle components.
- Tesla, considered a competitor of Lucid, also once considered the Casa Grande site for its $5 billion gigafactory before settling on Reno, NV.
Dive Insight:
State and local officials, including Arizona Gov. Doug Ducey, were on hand in Phoenix Tuesday to celebrate the Lucid deal, which should generate 2,000 jobs by 2022. The company had also considered sites in California, closer to its Menlo Park headquarters, as well as 60 others in 13 states. Lucid said it selected the Phoenix-area location because of its qualified labor force, access to highways and rail service and the relatively short distance by air to Menlo Park.
Arizona officials did not express any concern about Lucid's ability to come up with enough cash to see its plans through to fruition, unlike those in Nevada who questioned Faraday Future's financial health when that electric car company chose a North Las Vegas site for its $1 billion production facility.
Late last year, Chinese investor-backed Faraday announced that it was conducting a search for its plant and that it would accelerate construction in order to design and produce a car in time to compete with Tesla's rollout of its Model S in 2017. That timeline raised eyebrows among car experts who said it was doubtful that any company could meet such a super-tight schedule. After Faraday chose the North Las Vegas site, it hit a bump with state officials who had questions about Faraday's ability to pay for the project. Most of the concerns centered around the finances of primary investor and supposed tech billionaire Jia Yueting.
After assurances from Faraday, including $75 million in security, the state went ahead with a deal that would give the carmaker about $216 million in tax breaks — plus other incentives — in exchange for building the 3-million-square-foot plant there. However, last month, critics were somewhat vindicated when general contractor AECOM announced that Faraday had suspended construction on its new facility until next year. According to various press outlets, Faraday had fallen behind in its payment to the required construction escrow account before deciding to stop work.
Arizona officials are likely to hope for a similar economic boon from the Lucid factory that Tesla has created in northern Nevada. Tesla's $5 billion Reno, NV, gigafactory is nearing completion, with delivery of its first cars scheduled for 2017. The company is credited with bringing Faraday to the area as well as other businesses like data company giant Switch.