Visit The Lawrence Chamber Here!
by Rob Richardson
February 6-8, 2023, Gary Rexroad and Rob Richardson conducted a fact-finding trip to the Reno/Sparks area with the intent to discover how the Tesla/Panasonic Plant impacted residential and industrial development in the region and to discover companies involved in the Panasonic supply chain for battery production. It should be noted Gary Traveled at his own expense and that Rob’s travel was funded through the EDC’s Panasonic funds.
While driving the Tahoe-Reno Industrial Center where Panasonic/Tesla is located we discovered about 40 businesses we thought might have ties to batteries. Some we had to look in the front door to see the name on the wall as many businesses do not identify themselves with signage. We attempted cold calls on all of them that further internet research indicated the real possibility of a connection to batteries. All cold calls resulted in us leaving contact information. The Tahoe-Reno Industrial Center is the largest industrial park in the world. It attracts users and logistics operations well beyond the battery supply chain due to its centralized west coast location.
Relocating to Douglas County?
The Chamber of Lawrence
City of Lawrence
Lawrence Board of Realtors
Lawrence Public Schools
Douglas County Panasonic Opportunities Manager
“I am extremely excited to be working with the EDC of Lawrence – Douglas County to take advantage of the location of the new Panasonic Battery Plant in nearby De Soto. The Douglas County communities have so much to offer new investors, workers and residents – I look forward to being able to showcase our tremendous possibilities.”
Panasonic Update Continued
During the Trip we met with the following:
- Mike Kazmierski with EDAWN (EDC for Reno/Sparks/Tahoe)
- City Manager Doug Thornley and Assistant City Manager of Community Development, Eric Edelstein for the City of Reno
- Community Development official for the City of Sparks, Armando Ornelas
- Ian Cochran, a Commercial Realtor in the Reno area
- University of Nevada Reno Innovation Center Director, Ania Calvillo-Mason
- Several front desk/security personnel
There were some consistent themes from discussions and on-site research. Many we have known but some were new. The following is a summary of those themes:
- Panasonic and Tesla are very secretive.
- The Panasonic/Tesla suppliers are secretive.
- About half of the suppliers for Panasonic/Tesla are in the giga factory. About 25 percent are essentially next door within 5 minutes in the Tahoe Reno Industrial Center. The remaining 25 percent are somewhere in the region.
- The tangential or secondary building lag described as the “Tesla Effect” once the gigafactory opened was about 2 years. It took that long for others to discover the benefits of the park and that this Tesla thing is real.
- You cannot over prepare, once development starts, the pace of development is staggering.
- The pace of development was helped because the entire industrial park predevelopment was done in advance (all erosion control, storm water streets etc). Additionally, they grant same day earth work permits and review plans while they are moving dirt. The consensus is they do not have the staff to do proper review if any review is completed and there have been some longer- term building issues due to improper review.
- Reno had an issue with residential builders that had been hit hard during the recession and were afraid to build too quickly. This exacerbated housing issues.
- The location has been attractive for tax reasons as real property is allowed to depreciate in tax value over time. Additionally, values cannot increase by more than the lesser of the CPI or 3 percent. Finally, they have lower tax rates than Texas and no inventory tax.
- The area is also popular because you can drive to 11 western states in 8 hours and all major cities in less than 16 hours. This is why Home Depot, Chewy, Zully, Amazon, Walmart and others have massive distribution hubs in the Tahoe-Reno Industrial Center or in the Reno Area.
- If you are entrusted with information from a Panasonic executive – do not break that trust!
Some interesting items of note beyond what was uniform in their analysis:
- Panasonic is more open than Tesla to work with their partners – ask – how can we help you be successful
- Mineral recycling is huge business. One company, Redwood, is spending 5 billion on expansion between South Carolina and Reno. There were at least two other very significant recycling operations in the area. Lithium is currently trading near $450,000 a ton and has been near $600,000 a ton within the last 12 months.
- Have excellent promotional materials ready and distribute them amongst all the national industrial developers/brokers.
- Workforce needs are a Key concern to Panasonic.
- Large/fast influx of people created key secondary opportunities in services and transportation.
Strategies / opportunities to move forward
- Prepare for what might come
- Improve development process
- Have a clear incentive package
- Have sites fully prepared
- These users will move a massive amount of dirt for a good site
- Improve the development process
- Prepare housing for people that make $60,000 per year
- Work with Panasonic North America leaders always asking – how can we help you make this project successful. It was noted they had good luck working with the American Panasonic executives.
- Panasonic is a real manufacturing plant. They start with raw materials and make the batteries. They do not buy components and assemble them. Focus on recycling, raw material suppliers, chemicals, and expendable supplies.
- Focus on the attention this will bring. Many other prospects/companies will see the Panasonic move and look where they may not have looked before. Emphasize the logistics, and how far trucks can travel in 8 and 16 hours.
- Examine tahoereno.com and see how close we can get to match their offering.
- Begin the process to move/box the ditch in east hills to create a larger more developable site.
- Engage proactively on workforce readiness. Look beyond simple training and think about workforce as a supply chain.
- Understand the services needs for this new population and work to meet those needs. Professional services, Day care, elder care, transportation, and many others.
- EDC workforce development supply chain and lifestyle web page(s) newsletter(s).
I must include a special thank you to Gary Rexroad for his wisdom and friendship during the trip as well as his contribution to this summary. Please let me know if you have questions.
Robin H. Richardson, AICP
Douglas County Panasonic Opportunities Manager