Tesla Seeking Federal Loan to Build Model S on Brownfields
Tesla Motors hopes to secure funds by applying to redevelop brownfields sites; previously-developed land that is now deemed hazardous or polluted.
Though Silicon Valley electric car maker Tesla Motors originally had plans to develop a ‘virgin’ site in San Jose to house the company’s headquarters and manufacturing plant for its yet-to-be released Model S, the intended location, an 89-acre strip of land in San Jose apparently no longer works because Tesla wasn’t able to raise the $100 million in venture capital it needed to build on it.
But the fact that the private capital has fallen through may be a blessing in disguise for Tesla. By applying to develop its new manufacturing facilities on environmentally-troubled brownfields sites, Tesla will not only improve its standing with the federal government, but will also improve land in the process.
Company officials are reportedly in negotiations for potential brownfields locations throughout the state, from those left over in Southern California by the aeronautics industry to Silicon Valley sites that housed chip plants, wafer fabrication and technology factories. The federal loan program favors brownfields, sites where the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant.
Tesla, who has said they don’t think federal money should be diverted to bailout carmakers, is competing along with more than 75 companies, automakers and suppliers for the $25 billion in federal funds available through the loan program,
“We cannot do anything that may jeopardize securing the federal loan,” said Tesla senior communications manager Rachel Konrad.
Tesla has applied for about $400 million in two federal, low-interest loans through the Advanced Technology Vehicle Manufacturing Program: $150 million for an advanced battery and powertrain facility and $250 million for the Model S manufacturing plant.
The Model S is a five-passenger sedan with a lithium-ion battery pack that powers the car for about 240 miles per charge and is expected to sell for $60,000. The Model S has been named as one of the Top 10 Electric Cars Coming in 2009/10.
Image: Tesla Motors
