Tesla Motors is leaning toward two Southern California sites for a factory, and the electric vehicle maker suggested the targeted-for-closure NUMMI plant in Fremont won't suit its needs.
It also appears that the Bay Area might have few — if any — locations that would accommodate what Tesla seeks in a factory to make the company's Model S electric sedan, according to commercial real estate brokers.
The big problem with the New United Motor Manufacturing Inc. plant in Tesla's eyes? It's too big for what Tesla wants in a new factory.
"NUMMI is about 5 million square feet," said Rachel Konrad, a spokeswoman for San Carlos-based Tesla. "Tesla is looking for approximately 500,000 square feet. Tesla will produce roughly 20,000 Model S sedans in its first full year of ramped-up production. NUMMI is built to produce 15 to 20 times that."
The discouraging assessments comes a few days after executives with solar-panel maker Solyndra Inc. said they might consider NUMMI as a site for a third factory.
Tesla has fairly specific needs that might be tough to fill in the Bay Area. Although it is seeking roughly 500,000 square feet, the sedan factory could ultimately expand to 1 million square feet.
"Tesla needs a relatively large site," said John Yandle, a Cornish & Carey Commercial realty broker. "They don't want a build-to-suit. They want to find an existing manufacturing site. They have a quick time frame in terms of having
Long Beach and Downey have emerged as leading candidates for the Tesla Model S, a four-door electric sedan that would be family oriented.
But the Bay Area is still be in the running for the factory.
"We are in parallel negotiations on multiple sites in California for the sedan plant site," Konrad said. "It would be fair to characterize the sites as both northern and Southern California." Santa Clara County and San Mateo County are not under consideration for the sedan plant, Konrad added.
Recently, Tesla disclosed it had decided to rent a 350,000-square-foot Palo Alto building for its headquarters and powertrain assembly complex. That deal was arranged through Yandle and other brokers from Cornish & Carey and Jones Lang LaSalle.
"There just aren't a lot of sites in the Bay Area big enough to work for Tesla," said Mark Zamudio, a Colliers International broker.
And the NUMMI plant appears to have several marks against it other than its size. Among them: The factory, born a quarter-century ago as a joint venture of General Motors and Toyota, doesn't have the flexibility that Tesla desires.
"It's going to be highly 'scalable' so we can ramp up or down quite easily," Konrad said of the future Model S factory. "By contrast, at a huge and traditional assembly plant, it is very hard to ramp up or down without taking a huge cost hit."
About 600 to 1,000 people are likely to work at a future Model S plant, Konrad said.
Ultimately, were Tesla to use the NUMMI plant, even that decision wouldn't be a panacea for the 4,700 workers at the auto factory, which is slated to close in March 2010.
"While it's impossible to predict the future needs of a fast-growing company like Tesla, the idea that Tesla could swoop in and save all these jobs overnight is unrealistic," Konrad said.