Tesla Motors has put the brakes on the city that considers itself the capital of the electronic-car industry.
Tesla, one of two electronic-car startups that set up shop in the cash-strapped Peninsula city in recent years, announced Wednesday that it plans to build a factory in San Jose — and will eventually move its 200-employee headquarters there as well.
The 90-acre site in San Jose, which gave the new factory free rent for its first 10 years there, beat out proposals to place the new factory in South San Francisco, Vacaville and a site in New Mexico. The company decided to stay in California after the state offered to waive sales tax on $100 million worth of equipment.
The announcement by Tesla Motors Inc. was hailed as good news for San Jose, because it will create at least 1,000 jobs there. It could be a blow, however, to San Carlos, where Tesla began in 2003.
As it stands, Tesla currently makes about 600 cars per year, the zero-emission Roadster, which has a six-figure price tag. The body of that car is built in the United Kingdom and then flown by jet to San Francisco International Airport, Tesla spokeswoman Rachel Konrad said. From there, she said, the cars are transported to San Carlos, where the electric equivalent of an engine is built and installed.
The new factory will produce both the Roadster and the company’s second model, the Model S, which will cost $60,000. That model is expected to roll out of the factory by the end of 2010.
Konrad said it’s unclear how quickly the company’s headquarters would move from San Carlos to San Jose.
San Carlos acting City Manager Brian Moura said he’s not particularly worried about seeing a financial hit from the move, because he’s confident the property owners will find another tenant to fill Tesla’s space.
“It’s just the nature of startups — they come and go,” he said. The move did not come as a surprise, he said, because Tesla has gone through two separate searches for a new home. Moura said that when he heard San Jose was offering Tesla a 90-acre site rent-free, he figured that offer would beat out the South San Francisco proposal.
The good news for San Carlos, Moura said, is that Zap Cars, another electronic-car company, still has its showroom in the city.
“I guess we can’t hog them all,” he joked.
Tesla by the numbers
200 Tesla Motors employees in San Carlos
1,000 New “green collar” jobs expected at its newly announced San Jose manufacturing plant
89 Acres of the San Jose site where the new factory and headquarters will be built
$250 million Cost of the new factory
750,000 Square feet of manufacturing capacity and office space
$109,000 Cost of Tesla Roadster, above
$60,000 Cost of the planned Tesla Model S
225 Miles driven on a Roadster after a single 3.5-hour charge
2010 Year the factory is expected to roll out cars
Source: Tesla Motors