Tesla To Build Second US Assembly Plant In Texas

FREMONT, CA — Tesla announced on Wednesday that the company will build a new gigafactory on 2,000 acres in Austin, Texas. The plant will assemble cars for the eastern United States, as well as build the company's cybertruck and semi.

Tesla was granted tax breaks worth at least $14.7 million to build the factory in Texas.

Following the announcement, CNBC reports that Texas Gov. Greg Abbott said, "Tesla’s Gigafactory Texas will keep the Texas economy the strongest in the nation and will create thousands of jobs for hard-working Texans. I look forward to the tremendous benefits that Tesla’s investment will bring to Central Texas and to the entire state."

However, the announcement does not mean that the Fremont plant is closing. Musk said that Tesla will continue to build the Model S and the Model X for global deliveries right here, and the Model 3 and Model Y for North America.

Tesla is Fremont's largest employer with some 10,000 workers at the assembly plant, in addition to offices spread around south Fremont. The company's headquarters is in Palo Alto.

Company founder Elon Musk got into a battle of wills with Alameda County health officials over an order to shut down the plant in March when coronavirus shelter-in-place orders were issued. Musk insisted that automotive plant were considered essential businesses. The county pushed the issue and the plant closed.

But an initial belief that the health order would only last a few weeks was unfounded, and weeks dragged into months. By May, Musk had enough and opened the plant in defiance of the Alameda County health order, and said that he was prepared to be arrested for the action. That's when he threatened to move all operations, including the assembly plant and corporate headquarters, out of California. Fremont Mayor Lily Mei urged temperance on all sides. An agreement to reopen was reached within days.

Since then, there are been reports of employees testing positive for coronavirus, despite precautions taken by the plant.