With the current trend in the economy the privately held car company Tesla was unable to receive it’s Series E round of funding which was $100,000,000. Once unable to receive it’s funding they nearly ran out of cash but had the current investors put forth more cash to stay afloat. The move to San Jose was dependent on receiving low interest loans from the Department of Energy.

Tesla is trying to receive $400,000,000 from the Advanced Technology Vehicle Manufacturing Program which has $25,000,000,000 in funding available. They are competing against around 75 other companies competing for the same funds. The federal funds favor people trying to build factories on old/abandoned factories as opposed to new property sites. This is the reason Tesla claims they are not making a move to the San Jose campus, “We can’t afford to do anything that would jeopardize our ability to get the federal loan,” Konrad said.

Source: http://www.bizjournals.com/sanjose/stories/2009/01/26/daily71.html

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