What Tesla’s Gigafactory Means for U.S. Manufacturing Jobs and Investors

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Peaking at 19.5 million in 1979, that number had plunged 41% by 2009 as hundreds of companies outsourced production to countries with cheaper labor, such as China and Mexico. However, one U.S. company is doing its part to help return manufacturing jobs to the U.S.

Tesla has high hopes for its $5 billion Gigafactory, which is expected to build 35 GWh per year of lithium-ion battery packs, more than all the world’s capacity in 2013, enough for 500,000 electric cars, by 2020.

It is designed to lower the cost of its battery packs by 30% in 2017 and by as much as 50% by 2020, when the factory is slated to hit full production capacity. Those cost reductions are necessary due to Tesla’s plans to launch the Model 3, a purported $35,000 electric sedan with a 200-mile range that Tesla hopes will bring the joys of electric motoring to the masses and let the company achieve its aim of 500,000 cars sold annually by 2020.

The Gigafactory is expected to create 3,000 construction jobs and 6,500 factory jobs once it’s fully online in 2020. Through economic multiplier effects, up to 22,000 jobs might be added to the local economy.

Read more: SFGate