Tesla Motors Inc. (NASDAQ:TSLA) is a pioneer in design, manufacture and sales of electric cars and electric vehicle power train components. They had earlier set a target of building 500,000 cars every year by 2020 and suggested that increase in scales would ramp down the cost of electric cars.

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Their Giga factory is expected to be occupying 500 to 1000 acres of land and situated near highway and rail. The state, which accommodates this construction will get billions in direct investments and at least 6,500 potential jobs. Arizona, Texas, Nevada, California and New Mexico were reported to be competing to accommodate this world’s largest lithium-ion battery factory. Liz MacDonald of Fox Business News reported the updates regarding this facility.

MacDonald reported that Tesla Motors Inc. (NASDAQ:TSLA) are considering to build the Giga factory at Southern county area of Dallas in Texas. But she thinks that this proposal may hit a dead end after Governor of California, Jerry Brown had signed a huge tax benefit to such proposals and showed his serious intent of getting this facility to California. Another drawback with Texas is that they have banned the direct sales of electric vehicles, whereas California allows direct sales.

“So, what’s key here, is whether or not Tesla can get the tax breaks and also whether Tesla can surpass the powerful car dealer lobbies that are really in play in states like Texas”, she said.

She said that Tesla Motors Inc. (NASDAQ:TSLA) did not make any announcement on which state is being favored. Elon Musk, CEO of Tesla Motors, said that he will make that announcement at the end of this year.

There is a feeling that Musk is playing this game based on tax breaks that the company could get. There is also an opinion that Musk may even build two factories to get benefits of different states. Tesla Motors Inc. (NASDAQ:TSLA) are currently at a cap of $25 billion to $27 billion. When they achieve their target of 500,000 cars per year, then it might be $25 billion sales for the company. Even when they achieve this, it might just comprise 0.5% of global sales and 6.5% of premium sales, which is actually not out of the world and still practical.

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