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The Tesla Plant in Buffalo: Time for a Fresh Start

Date: Jul 21, 2025
Author(s): Sam Magavern, Kevin Connor
Topic(s): Economic Development: General, Economic Development: High Road Economic Development, Economic Development: Organized Labor, Economic Development: Policies and Programs, Environment: Air Pollution, Climate Change, and Energy, Environment: General, Poverty / Income Inequality: General, Poverty / Income Inequality: Wages and Benefits
Type: Policy Brief
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New York State’s billion-dollar subsidy deal with Tesla was corrupt and wasteful from its inception, and it has failed to meet even its own low goals. Mass layoffs have been frequent; job targets have been missed and drastically reduced; and workers have complained of illegal union- busting and racial harassment. The initial business plan—making solar roof modules—has failed, and many workers at the plant are not doing manufacturing but low-paid data analysis: tagging videos and maps. Tesla is assembling an AI supercomputer that will consume massive amounts of electricity and water—harming the environment and, most likely, driving up prices for residents and other businesses. Tesla’s business prospects look bleak, with earnings and stock prices plummeting and analysts skeptical of the company’s risky bet on self-driving vehicles.

With the company on shaky ground and its leader, Elon Musk, doing unprecedented damage to the nation’s democracy, economy, and health, it is time for New York to chart a new path.

A proposed new agreement between the state and Tesla, outlined in a non-binding letter of intent, would extend Tesla’s lease from 2029 through 2034. While increasing Tesla’s rent (previously, $1 per year), the proposal decreases job requirements, reduces the penalties for missing them, and fails to protect workers, local communities, and the natural environment. 

Rather than assuming that Tesla is the best possible tenant, New York should issue a new Request for Proposals for the South Buffalo property: a fair competition to see which company can provide the most high-quality jobs and other public benefits.

Any new lease or subsidy should include the following provisions:

  • Higher job targets;
  • Family-supporting wages and benefits;
  • Protection of workers from discrimination and harassment;
  • Card-check neutrality (a requirement that an employer recognize a union if a majority of workers sign cards in favor);
  • PILOTs (payments in lieu of taxes) for local municipalities;
  • Environmental protections regarding air, water, and soil quality, including a requirement that only renewable, non-nuclear energy be used to power the plant;
  • Community benefit provisions providing job and career pathways for workers; vendor opportunities for local, minority and women-owned businesses; and other benefits to the surrounding communities; and
  • Increased penalties for violations, including failure to meet job targets. 

In addition, New York should begin a comprehensive audit to make sure that Tesla has abided by the terms of the agreements and all applicable laws, and, if it finds violations, move promptly to enforce its rights.