SpaceX and Tesla Inc. CEO Elon Musk has announced that the company’s Terafab chip fabrication facility in Grimes County, Texas, will become the county’s largest source of revenue. This statement comes amid controversy over a tax deal that has been granted to the facility.
Terafab To Account For 25% Tax Revenue
Musk responded to concerns about the tax breaks given to the facility, stating that even with the breaks, SpaceX will still be paying an annual amount to the county that will increase tax revenue by 25%. This amount will be the biggest source of revenue for the county. Additionally, when accounting for the taxes paid by SpaceX employees and contractors to the county, Terafab will far exceed all revenue that Grimes County currently earns.
Musk explained that the reason SpaceX asked for property tax breaks was because it is standard practice for investments of that magnitude. Terafab will have a large number of extremely expensive machines for making chips, and property taxes on the machines would put the company at a serious competitive disadvantage compared to other fabrication facilities.
SpaceX IPO and Potential Tesla Merger
In related news, SpaceX has filed with the Securities and Exchange Commission (SEC) to sell over 555 million shares of the company at $135 per share, targeting a raise of over $75 billion. There have also been talks of a possible merger between Tesla and SpaceX, with some investors predicting an 80% chance of the merger happening next year. However, a merger between the two companies could also result in Elon Musk’s $1 trillion CEO pay package automatically kicking in without the company meeting the stipulated milestones.
Current Stock Performance
Tesla shares have been showing a favorable price trend in the short, medium, and long term, with excellent growth and quality. The stock was down 0.84% to $420.16 during after-hours trading on Wednesday.
Future Developments
As the situation continues to unfold, it will be important to keep an eye on SpaceX and Tesla for any future developments. With the potential for a merger and the ongoing expansion of Terafab, these companies are likely to remain major players in the tech industry for the foreseeable future.