Boston, MA 11/23/2014 (wallstreetpr) – Tesla Motors Inc. (NASDAQ:TSLA) CEO, Elon Musk, has defended the company’s decision to award Nevada the rights for the construction of the multi-billion battery factory. Musk was responding to claims that the company had used clever machinations into acquiring a bumper package incentive from the state of Nevada. The CEO has already termed the remarks untrue.
Fortune Allegations
An investigative report carried out by Fortune had outlined how a number of states had competed to build the factory by devising several incentive packages. Musk has already reiterated that Incentives offered to Tesla Motors Inc. (NASDAQ:TSLA) by the state of Nevada had been approved by majority of legislators in the state. The CEO has also affirmed that the deal was not merely good for the people of Nevada but extremely good.
Musk has rubbished allegations that he received cash from the state but acknowledged the company did receive a parcel of land from the state. Tesla Motors Inc. (NASDAQ:TSLA) argues that the contribution into the Gigafactory will only go to cover a small portion of the total cost. Incentives are to cover 5% of the total $5 billion investment needed for the project. The percentage essentially brings Nevada investment to $250 million and not the $1.4 billion initially announced by Fortune.
Incentive Package
Musk maintains that all the incentives that were approved by the legislature are performance based and do not act manipulative in any way. Reports had surfaced that Tesla Motors Inc. (NASDAQ:TSLA) demanded $500 million in cash from Nevada instead of pushing for tax abatement during negotiations. The CEO has also rubbished suggestions that the state didn’t right the giant electric company a blank check.
Nevada became the outright winner of the Gigafactory consequently earning the pole position for the 6,500 jobs up for grabs. As part of the 6,500 jobs being created, Tesla Motors Inc. (NASDAQ:TSLA) will also offer $3.75 million in donations to public schools that are to be opened in 2018.
On daily charts Tesla Motors Inc (NASDAQ:TSLA) has got a nice pattern of Up, Down, Up and now down. Going forward expect the stock to move down and correct till levels of $235, $220. The stock’s immediate support near $230 and $220, which if sustained can lead to a possible pullback in near term otherwise it is heading down.
