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California grants Tesla $34.7 million tax break to boost production - Dec 17, 2013

Discussion in 'Tesla Motors' started by SwedishAdvocate, Dec 18, 2013.

  1. SwedishAdvocate

    SwedishAdvocate Active Member

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    Unless I’m missing something; this is one tax break that I can get behind :wink: :


    Additional (?):

    California grants Tesla $34.7 million tax break to boost production - Autoblog


    - - - Updated - - -

    I meant to submit this to the News section, but apparently I managed to put it here instead…

    Oh, well.

    :redface:
     
  2. AMPd

    AMPd Active Member

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    As a California resident, I approve! And not just because I love tesla, but because itll bring more jobs and more sales to our state!
     
  3. Doug_G

    Doug_G Lead Moderator

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    That tax shouldn't exist in the first place, unless the goal is to kill jobs.
     
  4. derekt75

    derekt75 Member

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    Does Model S have the order rate to support the need to build twice as many?
    It seems to me that the time to get from reserving a vehicle to Tesla starting to build the vehicle is rather small right now, indicating that their production capacity is close to their order rate. Are they expecting order rates to double? It's already the highest selling expensive car model. How many cars can they realistically sell?

    or is the new equipment for Model X, and the article just misrepresented the purchase by saying the equipment would double the Model S capacity?
     
  5. AMPd

    AMPd Active Member

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    If I had to guess, id say the equipment will be used to build the model x as well, it is time to get all the equipment for that set up.
    Model S reservations will also start increasing since TM is accepting reservations from China, which if Elons predictions are correct, will bring in a significant amount of reservations.
    Not to mention UK will also be able to purchase a model S in 2014.
     
  6. Jeeps17

    Jeeps17 Cath Jockey in a P85

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    With the opening of the European and Asian markets, that number may be quite large...

    One can hope!

    Edit: Ampd beat me to it !
     
  7. Wild_Bill

    Wild_Bill Member

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    I wonder if this also means more Super Charging stations :)
     
  8. ecarfan

    ecarfan Well-Known Member

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    #8 ecarfan, Dec 18, 2013
    Last edited: Dec 19, 2013
    I am getting my S85 this Saturday and have waited 11 weeks for it!

    Tesla could sell more cars if they could build more.

    I am in California.
     
  9. Grendal

    Grendal Active Member

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    Tesla is up to 600 cars a week. That is 10K above their initial projections and the demand isn't slowing, but increasing as worldwide markets come online. Tesla has mentioned that they were going to run Model X's through their existing line, but that was when their Model S production goal was 20K. With the higher demand I will hazard to guess that they will need a completely separate manufacturing line for the Model X. This also gives them the cushion to allow for extra production where needed. I can easily see that the alpha and beta versions of the Model E and an initial test runs of that car could run on those existing lines while tooling up for the big buildup to large scale production in 2017.
     
  10. rolosrevenge

    rolosrevenge Dr. EVS

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    Right behind you...
    Well it is California ...
     
  11. montgom626

    montgom626 Active Member

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    Well said and so true.
     
  12. omgwtfbyobbq

    omgwtfbyobbq Member

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    Well... Well said but inaccurate.

    http://works.bepress.com/john_bishop/69/

    Targeted tax breaks for rapidly growing businesses are a good idea, but the notion that tax breaks in general create jobs (even in CA) is generally perpetuated by companies who want to pad their bottom line.
     
  13. Paul Carter

    Paul Carter Active Member

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    California grants Tesla $34.7 million tax break to boost production

    From AutoBlog

    Tesla Motors' plans to expand just got a big boost, as the state of California has announced it will give the Palo Alto-based company a $34.7 million tax break to increase its production capacity. The EV manufacturer is being given a pass on sales and use taxes on up to $415 million worth of equipment, according to a report on the
    San Francisco Chronicle's website.

    Tesla is currently on track to produce 21,500 cars, although the planned expansion should more than double that capacity to 56,500 units, adding 112 jobs at Tesla's Fremont factory. "I'm pleased we could take this action to encourage Tesla to expand its electric vehicle production in California, which will create green jobs and improve our air quality," State Treasurer Bill Lockyer said. The state estimates that between the additional jobs and (hoped for) increase in sales, it will recoup the costs of the tax break in more taxes.

    http://www.autoblog.com/2013/12/18/california-grants-tesla-tax-break-boost-production/
     
  14. jkirkebo

    jkirkebo Model S P85+ VIN 14420 EU

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    The wait time is still 6 months here in Norway. Also someone in the Tesla system here was saying they could probably sell 10,000 cars here next year if they got the supply.

    Personally I think 10,000 is a bit high, but 5,000 would probably be an easy target. That is a huge chunk of the total production volume...
     
  15. RobStark

    RobStark Active Member

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    At the very least it shifts job locations.

    Has an auto plant been built in the last 30 years without a long list of tax breaks?

    Don't offer them they don't get built in your location.
     
  16. tigerade

    tigerade Member

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    Agreed.

    Super exciting. I have only seen a handful of Tesla's in Atlanta, and I never get tired of seeing these beauties, so it'd be great to see more on the road. Anyone have a WAG on how long it might take to upgrade the factory after the new production equipment is purchased?
     
  17. eepic

    eepic Member

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    They've only tapped into a few of the many markets they could be in, and have not done any advertisements* to promote the car. The demand is there if they started pushing for sales, but right now they are still supply limited.

    If i remember correctly, by early/mid 2015 they are looking to be at a run rate of 40k/year Model S and a similar rate for Model X.

    *I think there was one train ad in Norway a while back.
     
  18. neroden

    neroden Happy Model S Owner

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    #18 neroden, Dec 20, 2013
    Last edited: Dec 20, 2013
    I'm not clear about this. Is this a specialized tax on the purchase of manufacturing equipment -- in which case it's ridiculous and a bad idea

    -- or is it just that general sales tax applies to the purchase of manufacturing equipment, which is not unreasonable.

    ...Ah, I see. It's just sales tax. California is one of the states which doesn't exempt capital equipment from sales tax. This is perfectly reasonable. The sales tax break is also perfectly reasonable. In general, I feel sales tax should be pretty low, as all sales taxes are regressive and economy-depressing taxes -- if sales tax were pretty low nobody would worry about this.
     
  19. Doug_G

    Doug_G Lead Moderator

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    We have a Value-Added-Tax here, which essentially means only the end consumer of an item pays the tax. This avoids hidden taxes getting added along the value chain. The tax is always paid on every transaction, but businesses claim back the payments they make from the government, net result nothing paid. My company makes products that are mostly exported so we're always getting refunds.

    If you look at the tax system, it's far more favourable to run a business in Ontario than in California. Especially small businesses.
     
  20. brianman

    brianman Burrito Founder

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    Reminds me of Republican presidential debates. Was it Santorum? I forget.
     

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