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New Mexico Tries To Lure Tesla Battery Factory

Wed, 03/19/2014 - 2:22pm

SANTA FE, N.M. (AP) -- Excited by economic prospects, New Mexico officials are hoping to avoid what happened six years ago when Tesla Motors opted against establishing an auto manufacturing plant in the state.

They're discussing a variety of options in an effort to convince Tesla to build a lithium-ion battery factory here, the Santa Fe New Mexican reports (http://bit.ly/1gGyC2U ).

New Mexico is one of four states identified as finalists for a lithium-ion battery factory that would supply the company's Fremont, Calif., assembly plant. Others are Arizona, Nevada and Texas.

That possibility has generated excitement among business leaders and elected officials.

But it isn't the first time the state has been excited by prospects involving Tesla.

In February 2007, Telsa announced that it would build a $35 million auto manufacturing plant in New Mexico. At a news conference with then-Gov. Bill Richardson, Tesla CEO Elon Musk said the company would build the plant on Albuquerque's west side. Construction on that 150,000-square-foot plant was scheduled to begin that spring.

Musk said his company would produce at least 10,000 cars a year at the Albuquerque plant and that the first cars would roll out in the fall of 2009.

But the plant never opened after California gave the company a sweeter tax-incentive deal.

Richardson's Economic Development Secretary Fred Mondragon, who announced Tesla's decision in 2008, expressed some bitterness at the time in his statement: "This decision by Tesla is not surprising given the recent instability of its management," he said. "Still, it is unfortunate that Tesla backed away from its commitment to the state."

Gov. Susana Martinez said this time she would call a special legislative session if needed to secure a deal.

Asked about the state's prior experience with Tesla, Martinez's spokesman Enrique Knell did not answer directly Tuesday.

"Tesla is a fantastic company, and we would certainly be thrilled and excited to have them come to New Mexico," he said in an email. "We continue to have regular conversations and are competing hard to bring these new jobs and this forward-looking company to the state."

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