Ray Hagar

rhagar@rgj.com

Senate Majority Leader Harry Reid said Monday that Reno should take a wait-and-see attitude about a Tesla Motors battery gigafactory coming to the area.

"I would not start counting jobs on Tesla now, anyway," Reid said during a news conference in his Reno office. "I will say, I'm not sure they aren't playing us."

The electric car maker has confirmed it has broken ground on a construction pad at the Reno-Tahoe Industrial Center in Storey County east of Sparks.

But Reid said, "They've got pads in several states."

When asked if he thought it was more likely to build the gigafactory in another area, Reid said:

"I really don't know. I just know there is kind of a bidding war out there with the state of California and the state of Texas. I don't know what other states are involved. But there is a limit to what we can offer. And where that limit is here or not, that is up to Gov. Sandoval."

A late afternoon call to Steve Hill, the director of the Governor's Office of Economic Development, was not returned. An email to Tesla's corporate offices was also not returned Monday afternoon.

The Palo Alto, Calif.-based Tesla has disclosed that Nevada is a finalist for the 10 million-square-foot factory that Tesla wants to open by 2017 to make batteries for its Model 3 car. The factory is estimated to cost about $4 billion to $5 billion.

Tesla has done grading on 600 acres of sagebrush at the TRIC, which has been off-limits to passersby and has been identified only as "Project Tiger."

But that doesn't mean Nevada has won the project — coveted by officials in several states vying for an estimated 6,500 jobs the gigafactory will bring, Reid said.

"I appreciate very much that the governor (Brian Sandoval) is keeping me informed on what is going on with Tesla," Reid said. "He's tried very, very hard. I told him and I'm telling each of you that I support what he has done."

Reid said he believes Tesla will build the gigafactory in the state where it can make the most money.

"(Tesla CEO) Elon Musk, I know him," Reid said. "I have spoken with him many, many times and he is a brilliant man. And that is probably an understatement. But he is in it to make money. And he's going to take this Tesla project where he can make the most money."

Reno Mayor Bob Cashell called Musk an excellent negotiator.

"Right now, I don't know anything," Cashell said. "If I did, I would tell you. But I would have to agree with Harry. We don't want to start counting your eggs, because nobody knows. This guy (Musk) is one of the best negotiators that has come around and he is looking for what is the best deal for his company."

In a conference call with Wall Street analysts recently, Musk said of the grading work at TRIC and the urgency of the endeavor: "We're going to be doing something similar in one or two other states. It makes sense."

He did not identify those states. Texas, Arizona, New Mexico and more recently, California, have been known to be the other semifinalists.

Nevada will have its work cut out for it against the competition, officials have said. Musk said in a letter recently to Tesla shareholders that the final gigafactory site will be determined "in the next few months."

First, though, is the issue of cost. Musk, speaking with analysts after release of Tesla's second-quarter earnings, cited an a late-July agreement between Tesla and Panasonic Corp. for proceeding with the gigafactory.

The two companies will cover most of the project's costs, he said. But he expects the winning state to put up as much as 10 percent. He did not elaborate on what form that stake would be in.

Tesla spokeswoman Liz Jarvis-Shean has said the state portion is "best described as a package of benefits and incentives."

For Nevada, that would mean committing $400 million to $500 million — a sizable sum given the current statewide general fund budget of $6.5 billion.

RGJ reporter Anjeanette Damon contributed to this report.