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California Governor Arnold Schwarzenegger took to the podium today at Tesla's San Carlos, California facility to formally announce a new set of incentives for EV manufacturers to call Cali home. The crux of the address centered on the new CAEATFA program, approved last Wednesday, that exempts automakers from paying sales and use tax on manufacturing equipment used to build EVs. The program is expected to save automakers – and Tesla specifically – millions of dollars, and is largely in response to Tesla's original plan to produce its new sedan in New Mexico.

Tesla used the Governor's visit as an opportunity to formally announce its new "multi-use sport sedan," currently codenamed Model S, which is estimated to get 225 miles on a single charge and to cost around $60,000. However, Tesla did not announce when the sedan would go on sale, nor would it give any indication about where the new EV would be produced.

UPDATE: Official press release pasted after the jump.

PRESS RELEASE:

Governor Schwarzenegger announces support for manufacturing future Tesla cars in California

San Carlos, CA – Ze'ev Drori, CEO of Tesla Motors, and Governor Schwarzenegger announced today at a press conference at Tesla Motors headquarters that Tesla's next product, a 4-door, 5-passenger sedan, will be manufactured at a facility in the state of California.

Previously it had been announced that the sedan manufacturing facility was planned for Albuquerque, New Mexico. After a thorough review of the program, Tesla decided that it would be highly advantageous to build manufacturing facilities in close proximity to the engineering and research and development functions in Tesla's San Carlos headquarters. Tesla's battery pack, a critical component of the Tesla Roadster, is currently manufactured in California. Final assembly of the Tesla Roadster is also currently in California.

Governor Schwarzenegger and the state of California also made it clear that they wanted to keep Tesla manufacturing in California. "Today's announcement is incredible news for California's economy and its environment. If California was a baseball team this would be like winning the first round draft pick and recruiting a player who is a perfect fit on our roster because Tesla Motors and its all-electric cars belong in California," enthused the Governor.

Last week, the California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA), approved a new program that exempts new Zero Emission Vehicle manufacturers from paying sales and use tax on the purchase of manufacturing equipment and will encourage ZEV manufacturing in California. Tesla will also be eligible for at least $1 million in Employment Training Panel Workforce Development Funds to train employees.

"These vehicles can play a big part in helping California successfully implement its groundbreaking laws to fight climate change," said State Treasurer Bill Lockyer, who chairs CAEATFA. "By offering this financial incentive, our goal is to ensure zero-emission vehicles realize their full potential in our state. In the bargain, we believe the policy will bolster our emerging green economy, create good-paying jobs and reduce our dependence on foreign oil. I'm very pleased the policy helped convince Tesla to build its high-performance electric cars in California."

Ze'ev Drori, President and CEO of Tesla Motors, remarked, "Tesla has achieved an extraordinary accomplishment. We are the only automobile company today delivering full performance battery-electric vehicles to our customers. Make no mistake - we are not a niche player with a car only for the rich and famous. As our agreement with the state so clearly demonstrates, we are building a high volume ZERO EMISSION VEHICLE, manufactured in California for mid-range family use. And we aren't going to stop there. We will continue on and build even more affordable cars. You are witnessing the debut of a new car company, a company unlike all others, a company with a disruptive technology, a company dedicated for the exclusive production of Zero Emission Vehicles."

Tesla's sedan, which is targeted for late 2010 production, will utilize Tesla Motors' leading electric powertrain design in a car that is both stylish, high performance, yet highly practical. The exact location of the manufacturing facility within California will be decided soon.


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  • 32 Comments
      • 6 Years Ago
      Bullcrap @ #1?

      Why? The Roadster battery is $35,000 in costs, if I remember correctly. Why would a $60,000 figure be so far off?
      • 6 Years Ago
      I want to be the first to say it...bullcrap.

      225 mile sedan for $60K? Either it's far in the future or it's going to use lead-acid batteries.
        • 6 Years Ago
        It's doable. The model S will use less expensive aluminum and steel instead of carbon fiber, and they may be using a lower cost per Kwh batteries as well. They are planning a greater production volume, allowing for some volume purchase discounts, and taking a smaller profit margin on each vehicle. They will be using some components from the Roadster that are already developed and tested, reducing development costs.

        Mind you, they have a lot of challenges ahead, and competition from older companies as well.
        • 6 Years Ago
        First of All, the Tesla doesnt use Lead Acid batteries. It uses a combination of thousands of tiny Li-ion laptop batteries.

        The vehicles only flaw is that if you buy a Tesla and have it shipped out of state, there is no place for getting it serviced. Matter of fact the only service stations are in California and they only have 3 locations.


        They are getting incentives and help from the government but not every governor is the governator.

      • 6 Years Ago
      Since the battery is easily the most expensive part of an electric car, anyone have thoughts on the following?

      1) Volume discounts.

      When negotiating a contract, it's a lot easier to get a lower price when you'

      2) Pack build automation.

      Tesla doesn't have to pay tax on manufacturing equipment? You better believe they'll be using robots to make their battery packs for the 'Model S' it will probably still take some people to test the resulting batteries, but it will be faster, cheaper, and more consistent to have it be as automated as possible.

      3) LiPo vs LiIon cost to energy density ratios.

      I haven't heard anything about chemistry switches, but it would make sense. As far as I know, LiPo is both able to store the more energy per weight/space unit, AND has no known thermal runaway issues. not having to have a cooling component to the battery will make it simpler and lighter, and higher density would mean more range for the same volume.

      Of course, if they keep the same blade configuration (just arrange the blades differently in the sedan) then new chemistry blades could probably be popped into the Roadster to increase range there too. Being computer folk, I think 'modularity in design lowers costs' is not lost on them...
      • 6 Years Ago
      Doug -- The 225 mile quote was in the press release we received at the event, so it is official.
      • 6 Years Ago
      "However, Tesla did not announce when the sedan would go on sale..."

      The press release gave a target of late 2010 production.
      • 6 Years Ago
      They suggested Tesla would receive greater incentives if the manufacturing plant would be located in an Enterprise Zone. So, my guess is that it will be in Salinas Valley, Kings County, or Oakland.
      • 6 Years Ago
      @Blackbird

      I like how you come up with all these made up figures and than say how tesla is off $10k. LOL I'm thinking that Tesla's back of the envelope calculations have a little more substance than your back of the envelope calculations.
      • 6 Years Ago
      @Whopper
      Guess who's paying for the tooling.
      • 6 Years Ago
      225 Miles, is about the same electricity to ONLY produce 1 gallon of gas, JUST TO REFINE IT.

      Think about it!
      Use NO gas AND save electricity buy charging this car on the grid!!!
      • 6 Years Ago
      Doug -- For some reason they didn't post the same press release online as what was handed out to us at Tesla. As soon as that goes live, I'll post a link.
      • 6 Years Ago
      It's hard for me to believe that they will mass produce in 2010, when we haven't seen the vehicle yet even on paper and only a handful of Roadster have thus far been delivered.
      • 6 Years Ago
      Ok, Thanks OhmExcited. They must have updated that press release on the Gov's page since that info wasn't there when I first read it. (They have also added photos and a link to the video.)

      Wave54, it is perhaps a bit premature, but they didn't really give much information about the sedan. Intentionally, I'd guess. The timing of this announcement probably had more to do with the Governor's schedule than anything else.
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