Dive Brief:
- Austin, Texas, announced Thursday it will be the site of a $1.1 billion Tesla factory, edging out Tulsa, Oklahoma, for the company's second U.S. plant, where Elon Musk's new Cybertruck will be built.
- The city was selected after Austin officials last week approved property tax rebates amounting to at least $60 million over 10 years, with $14 million contributed by Travis County, where Austin is located, and another $50 million coming from the local Del Valle School District.
- The Tesla factory will be built on 2,100 acres near Austin-Bergstrom International Airport. It will be the company’s largest auto assembly plant.
Dive Insight:
Austin and Tulsa put together competing incentive packages to attract the factory, which could bring 5,000 to 7,000 jobs, Reuters reported. Musk had stated that major deciding factors for the Tesla plant’s location would be tax incentives, access to a large workforce and a high quality of life.
Texas doesn’t have corporate or income taxes, and the region’s young workforce is among the most educated in the country. But Austin’s large tax rebates appear to have done the trick.
Meanwhile, Tulsa appears to be left in the lurch. The city repainted its famous “Golden Driller” statue to resemble Musk, along with the company’s logo.Video testimonials appealing to Tesla sprung up, and, in early July, Musk met with Oklahoma Gov. Kevin Stitt to discuss building the factory there. Stitt posted pictures of the meeting on his Twitter account.
Though Tulsa signed a nondisclosure agreement about its incentive package, Oklahoma Commerce Secretary Sean Kouplan told Reuters before the decision was announced that the city’s package was comparable, if not better, than Austin’s, with a $1 billion renovation of downtown Tulsa already underway.
The race between the two cities for the Tesla plant was reminiscent of East Coast cities vying for Amazon's HQ2, a coveted job-promising second headquarters for the online retail giant that was ultimately awarded to Arlington, Virginia. Amazon was courted by a variety of cities offering beefy incentive packages, but choose Northern Virginia for the same reasons that Tesla choose Austin.
