As production at Tesla's gigafactory ramps up, Austin feels economic effects

Tesla Giga Texas
Giga Tesla, an approximately 4.5 million-square-foot factory in Travis County, is now Tesla's headquarters. (Courtesy Falcon Sky Photography)

Giga Tesla, an approximately 4.5 million-square-foot factory in Travis County, is now Tesla's headquarters. (Courtesy Falcon Sky Photography)

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Experts say Austin's reputation as a tech hub is growing. Here is a timeline of major developments. (Community Impact Newspaper)
Electric automaker Tesla is set to ramp up production out of its southeastern Travis County gigafactory in 2022, bringing thousands of jobs and sending ripples through the region’s economy.

Giga Texas, as the factory is dubbed, will produce the Cybertruck, Model Y sedan and, eventually, batteries. Tesla CEO Elon Musk confirmed in a tweet—his chosen method for communication—that Tesla would hold a grand opening party in 2022. Tesla did not respond to request for comment by press time.

Musk’s interest in Austin has grown past the factory. In late 2021 he announced Tesla’s headquarters would relocate to Giga Texas from Fremont, California. Musk’s mining venture, the Boring Co., has leased space in Pflugerville, and his company SpaceX has published job listings teasing “a new, state-of-the-art manufacturing facility” in Austin.

Musk said he is interested in the area because of its central location in the United States and Texas’ favorable regulatory environment.

Local economic experts also say Tesla will raise the city’s profile as a global hub for innovation.


“This is sort of an affirmation that [Musk’s] foray into Austin with the gigafactory was not just a whim, but rather it was his long-term intention. And that’s a powerful signal,” said Dirk Mateer, an economics professor at University of Texas.

Innovation central

Giga Texas, located northeast of Austin-Bergstrom International Airport, spans more than 4 million square feet, according to state documents, and has transformed the 2,100-acre former mining site at the corner of SH 130 and the former Harold Green Road—now Tesla Road.

To reel in the facility, Travis County extended a tax incentives deal that will save Tesla $13.9 million over its first 10 years in the area. Tesla, in turn, said the plant would bring at least 5,000 jobs. In a tweet early last year, Musk said more than 10,000 jobs will be tied to Giga Texas in 2022 alone, and he upped his overall estimate to 20,000 on Dec. 16. He also said investment in the factory would total over $10 billion.

Austin is coming off two record-breaking years for industry and job growth, Austin Chamber of Commerce CEO Laura Huffman said. She expects Tesla to lead another strong year.

“We estimated ... that for every job Tesla brought, you would get between four and six other non-Tesla jobs,” Huffman said. “We’re seeing that happen.”

Huffman said Austin’s emergence as a manufacturing and technology nerve center has influenced other companies to consider relocating or expanding in the region; Oracle announced its headquarters would move to Austin at the end of 2020, and Samsung decided late last year to bring a $17 billion semiconductor plant to Williamson County.

Training up a workforce

Hiring has already begun at Giga Texas; nearly 350 jobs were posted to Tesla’s careers site as of Jan. 9. Per Tesla’s economic development agreement with Travis County, all jobs at the factory must pay at least $15 an hour and 50% of initial jobs should go to Travis County residents.

Tesla has created several hiring pathways through partnerships with local institutions such as Austin Community College and Del Valle ISD. Similar to Travis County, DVISD, the district Giga Texas falls in, forged a tax incentive agreement that will yield the automaker an estimated $46.4 million in savings over 10 years.

Several classes have completed ACC’s Tesla START program, a 14-week course in which students learn skills, such as robotics and control systems technologies.

“We literally get more requests for students that are graduating [from ACC manufacturing programs] than we have students,” ACC Advanced Manufacturing Chair Laura Marmolejo said.

One of those students is Rosie Carter, who recently completed ACC’s Certified Production Technician program after a career in cosmetology. Carter passed up job offers from at least four companies in favor of hedging her bets on being selected for the START program.

“If I can do a small part in renewable energy in cars and kind of getting off the gas mainline ... I’d like to do that,” Carter said.

DVISD students are equally eager to find an in with Tesla, said Alex Torrez, the district’s first workforce development officer and liaison with Tesla.

“I’ve had several elementary students contact me and tell me they’re Tesla enthusiasts,” Torrez said.

Workers in demand

Some local employers have observed that Tesla’s allure is making competition for qualified workers steeper in an already challenging market.

Gabriel Spencer, who runs Capital City Electric alongside his wife, Iris, said their business is able to pay competitively, but candidates are often drawn to the longer contracts that Tesla can offer.

“My wife and I have had a hell of time finding qualified applicants,” Spencer said.

Musk has said even candidates without a high school diploma could be considered for certain positions, and Huffman said most people are “within a certification” of becoming qualified for a position at the factory.

Some local advocates, however, are concerned that certain workers are being shut out of jobs with Tesla.

Ofelia Zapata, an Austin ISD trustee and member of the Texas Anti-Poverty Project, a group that meets with Tesla to discuss opportunities for the local workforce, criticized Tesla’s lack of outreach to people without internet access or who do not speak English.“[We] continue to ... hold Tesla accountable to ensure that residents of Travis County get first shots at these jobs,” Zapata said.

At DVISD, however, Torrez said some students who speak English as a second language were members of the first cohort to move through the district’s training partnership with Tesla.

“Obviously, language can be a barrier,” Torrez said. “[But] if you can’t speak really great English, it doesn’t mean you can’t be a part of this program. It’s about learning the skills.”

‘The costs of progress’

While the gigafactory represents thousands of jobs for Austin natives, it also foreshadows a potential influx of people from other areas seeking work in Austin. Already, ACC has seen heightened interest in its manufacturing programs from across the country. For locals who do not see Tesla as offering a personal opportunity, an inpouring of new neighbors may make life more expensive in an already competitive housing and rental market—a fate Mateer called “the costs of progress.”

“If I was a local ... and all of a sudden there’s all these high-paid workers around, I better hope that I actually own my house,” he said.

Huffman said she and her colleagues at the chamber are eyeing the effect Tesla, Samsung and their peers could have on affordability and infrastructure needs.

“This kind of growth requires ... us to keep our eye on intended or unintended consequences,” she said.
By Olivia Aldridge

Multi-Platform Journalist

Olivia hosts and produces Community Impact Newspaper's podcasts, The Austin Breakdown, The Houston Breakdown and The DFW Breakdown. She launched the podcasts after nearly three years as a reporter for the newspaper, covering public health, business, development and Travis County government for the Central Austin edition. Olivia worked as a reporter and producer for South Carolina Public Radio before moving to Texas.