California has beat New Mexico in landing the new plant in which electric car company Tesla Motors will build to make its sedan with zero emissions, the Model S.

Originally, it looked like the 400-employee plant would go to New Mexico; however, Arnold Schwarzenegger announced that California would find financing for $100 million worth of equipment for manufacturing.

Tesla would lease the equipment, and their payments to the state would then go towards paying it off.  Then, the company could purchase the equipment when the lease term comes to an end, without paying sales tax.  This would allow Tesla to save $9 million.

New Mexico was not happy about Tesla’s decision to change to California, and said that management problems within the company were a factor.  Martin Eberhard, Tesla’s co-founder, was replaced last summer as CEO.

According to Tesla, the Model S will sell for $60,000 initially, although they already have a plan for a $30,000 model.  This will mean that consumers can afford to purchase a zero emissions vehicle and an auto warranty, and know that they are protecting their environment.