Reno bets on Tesla gigafactory
Elon Musk’s sprawling factory outside Reno, Nevada, won’t start making batteries until next year, and local residents are already talking up the “Tesla effect.”
The farm-to-table Campo restaurant in the city’s trendy Riverwalk District is offering a 10 percent discount to Tesla employees. This month, the Siena Hotel and Casino is promoting the “Tesla Triple Spin Wheel” and giving away Model S sedans.
Tesla employees have begun relocating from the San Francisco Bay area, buying houses in leafy neighborhoods and enrolling their kids in local schools. The new Whitney Peak Hotel, a non-smoking, non-gambling luxury inn, has become the unofficial headquarters for visiting Tesla workers. JetBlue Airways began offering the first direct flights from New York last month and says the route is already well-subscribed.
Tesla Motors Inc.’s $5 billion “gigafactory” may be the best thing to happen to northern Nevada since the silver rush of the 1850s and the gaming boom a century later. The company’s decision to build the facility in an industrial park east of town is giving the self-proclaimed “Biggest Little City in the World” a once-in-a-lifetime opportunity to diversify the economy and transcend Reno’s image as a downmarket Las Vegas.
“We’re getting incredible national and international recognition as the place that Tesla picked,” says Mike Kazmierski, president and CEO of EDAWN, the Economic Development Authority of Western Nevada.
The city has lured several large technology companies. Apple Inc. is building a data center.
Amazon.com Inc. moved a distribution warehouse from rural Fernley, Nevada, to a 1.2- million-square-foot warehouse closer to Reno.
Switch, the Las Vegas-based developer of data centers, is building a facility near Reno and helping to fund the University of Nevada at Reno’s new innovation center downtown.
The hope is that Tesla’s gigafactory will attract other manufacturers, employers that typically stick around for the long haul unlike technology firms that are more likely to close data or customer-service centers when their business model changes. Exhibit A: International Business Machines Inc., which recently fired half its workers in Dubuque about five years after opening a customer-service center in the Iowa city.
John Boyd, who helps companies scout locations for new facilities, says Tesla could transform Reno much the way BMW did Spartanburg, South Carolina, when the automaker opened a plant there in the 1990s. Boyd says suppliers will flock to be close to Tesla as they have in Fremont, California, where the company builds its electric cars.
Panasonic Corp., a supplier and major investor in the gigafactory, plans to send hundreds of workers from Japan.