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Tesla Looks to California for Electric Sedan Production

With their headquarters and heritage already established in Silicon Valley, executives from electric car manufacturer Tesla Motors today told California governor Arnold Schwarzenegger 'they'd be back' to build future products in-state.

The announcement comes after speculation regarding the location of Tesla's next assembly facility. While the company's current product, the Lotus-based Roadster, is partially built in Hethel, England, Tesla had indicated it hoped to build its next offering, the Model S (previously referred to as Whitestar) sedan, in the United States. The car is expected to be a full five-passenger electric vehicle with a price tag of $60,000.

Company executives had looked at a number of locations for the plant, and were seemingly set to break ground in New Mexico. That decision didn't jive well with Schwarzenegger, a Tesla enthusiast (and future owner) himself.

"I myself bought one of the first Tesla cars," he said at a press conference this afternoon. "For me to see this company build these cars in New Mexico drove me absolutely insane."

Schwarzenegger worked with state treasurer Bill Lockyer to draft new financial incentives - reportedly totaling in excess of $1 million - that would lure Tesla to California.

Perhaps most pivotal is a program passed by the California Alternative Energy and Advanced Transportation Financing Authority, which exempts companies building zero-emission vehicles from paying sales and use taxes on manufacturing equipment. Further aid could come if Tesla locates in one of the state's eight Enterprise Zones - areas promoted by the government for business development.

Tesla executives haven't yet announced precisely where in California they're seeking to locate the facility, but Lockyer indicated that the factory would bring approximately 400 white-collar jobs to the state. Tesla chairman Elon Musk did let slip that the plant could accommodate a product other than the Whitestar. Musk wouldn't comment extensively on its details, other than to say it is an EV priced at under $30,000, and set to launch "within four years."