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Tesla Selects Austin, Tulsa as Finalists for Future US Factory

Tesla selected the cities of Tulsa and Austin as finalists for its next U.S. assembly plant, where the "Cybertruck" will be built, after CEO Elon Musk threatened to leave California.

Tesla has chosen Tulsa, Oklahoma, and Austin, Texas as the city finalists for its forthcoming U.S. assembly facility, according to a source familiar with the situation, reports AP News.

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Tesla selects two finalist cities for new US auto plant

The person familiar on the matter said company officials made visits to Tulsa in the last week, and surveyed two potential sites, according to AP.

However, it wasn't initially clear whether other cities were also on the final roster for the automaker. The person wished to remain anonymous because the site selection process is secret, and added that the decision has yet to be finalized.

Stakes are sky-high for state and local governments, which vie for car factories because they attract a vast workforce and typically pay well, which generates income and property taxes.

At present, Tesla's main U.S. vehicle plant is in Fremont, California, where 10,000 workers are employed. The automaker has a second U.S. factory in Reno, Nevada — where it builds batteries for all-electric vehicles and employs roughly 6,500 people.

Across the Pacific Ocean, Tesla also has a plant in Shanghai, and even a third under construction in Germany.

The road ahead for Tulsa and Austin

After selecting finalist cities for a forthcoming assembly plant, automakers typically look at proposals from each city, bargaining for their shot with the best package of site investments, tax breaks, and other incentives.

Notably, the new plant will see the construction of Tesla's forthcoming "Cybertruck," and also be a second building site for the small SUV, called the Model Y.

During the automaker's earnings conference last month, CEO Elon Musk said the site of the company's third U.S. factory might be announced in a month.

Musk calls his assembly facilities "Gigafactories."

The mayors of each city, G.T. Bynum of Tulsa and Steve Adler of Austin, including Governor Kevin Stitt of Oklahoma, all declined to comment on whether their cities were officially finalists in Tesla's selection process, according to Autoblog.com. Governor of Texas Greg Abbott also didn't give an immediate response, reports AP.

Elon Musk's earlier threats to leave California

Last week, Musk threatened to move Tesla's manufacturing activities and headquarters out of California amid a dispute between the company and San Francisco Bay Area health officials regarding whether the Fremont plant would be allowed to reopen after initial closure to curb the spread of the COVID-19 outbreak.

This came on the heels of Musk's defying orders to stay closed from Alameda County's Public Health Department, which involved the plant running without permission for two days before a settlement was announced.

The department said the facility is allowed to run above minimum basic operations last week and resume the production of vehicles today, so long as it continued to deliver on full safety precautions for employees.

However, it won't be easy for Musk to move Tesla out of Fremont because the company would have to shut down its only U.S. assembly plant for months while it transferred heavy assembly equipment to a new site, according to AP.

It would also be difficult for Tesla to transfer its headquarters to another state because software engineers and other technical workers likely wouldn't like the idea of relocating — perhaps electing to work elsewhere in the San Francisco Bay Area.

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