The Bay Area Council has been advocating over the past several months for California to step up its game in competing for Tesla’s proposed Gigafactory, and recently led a group of state legislators on a tour of the electric car maker’s Fremont manufacturing plant. In the following opinion piece published in the San Francisco Chronicle on Aug. 18, Council President and CEO Jim Wunderman explains why California must win this competition.
All major indicators show that California has emerged from the worst recession in living memory, when home values plunged, unemployment rocketed, and, on a couple of very embarrassing occasions, the State of California was forced to pay its bills with IOUs. Driven by a boom in technology, primarily in the Bay Area and international trade in Los Angeles, all seems well again in the Golden State. But it’s not. The recovery is uneven, with painful pockets of very high unemployment and a shocking dwindling of middle class jobs. According to 2014 Bureau of Labor statistics, seven of the top ten unemployment black spots in the nation are here in booming California. Communities up and down the Central Valley like Merced, Stockton and Fresno still struggle with double digit unemployment.
So the very highly skilled and highly paying jobs are back, but the well-paying middle class jobs in manufacturing, agriculture and construction, that don’t require advanced degrees, are scarce. Something must be done to help these communities, but what?
You may have heard of the car maker Tesla. Tesla is a California company, born in our unique innovation economy and is a standout California success story. The company is in advanced planning to build a “Giga factory” somewhere in the western United States. This huge plant will manufacture the next generation of batteries that will power, not just the cars of the future, but our homes and office buildings too. This once-in-a-generation venture will require a $4 billion investment by Tesla and will initially create 6,500 full time jobs followed by tens of thousands more in support and service industries, such as construction and retail.
Tesla’s mission is to “accelerate the advent of sustainable transport by bringing compelling mass market electric cars to market as soon as possible.” To complete that noble goal, Tesla must get this plant up as quickly and for the least cost possible, and indeed, the plan is to be open and operational, making batteries and printing pay checks, in just over two years!
As you can imagine there is intense competition in the U.S. to attract Tesla’s attention. Other states are offering huge financial incentives, land, and a fast tracked permitting process. We too must use every tool available to us to compete for these jobs. California’s entrepreneurs and engineers created Tesla and we are the number one market for Tesla cars. California is a world leader in renewable energy, energy efficiency, and ground breaking climate change legislation and it is clear that Tesla shares our values. There is no reason other than a lack of will or imagination for this factory to locate anywhere but California.
There are several proposed sites in the central valley that reportedly meet Tesla’s needs from a logistics perspective. Should Tesla select one of those, it is projected that a cluster of battery technology companies will soon follow, accompanied by a chain of logistics and supply companies along the I-5 corridor from Redding to San Diego creating tens of thousands of good paying middle class manufacturing jobs. This factory will be a win for the whole state. It will kick start a new growth industry for the State and make us the world’s leader in battery technology and manufacturing.
With balanced and on-time budgets, a new water bond, and a strengthened commitment to clean energy, California is proving to the world that we are back, stronger than ever and ready for the future. Losing the Tesla Giga plant would be a huge blow to our image, and a huge loss for our economy, particularly the middle class and the Central Valley. Nevada, Arizona and Texas will push hard and a final decision is expected from Tesla in the very near future. We urge Tesla to build this plant in their home state and we urge the Legislature and the Governor to step out of their comfort zones to make this happen in California. This one’s worth the fight.