From Dana Hull at the San Jose Mercury News, more information about Elon Musk’s Gigafactory, which he believes can cut battery costs by 30%, a key to making Teslas more affordable:

“The planned $5 billion gigafactory is key to Tesla’s strategy of manufacturing a more affordable, mass-market electric car. Tesla has not finalized a location but is looking at several states, including Arizona, Nevada, New Mexico and Texas. California is also being considered but is regarded as a long shot because of the lengthy time required for the permitting process.

In an onstage interview with venture capitalist Ira Ehrenpreis, an early investor in Tesla who sits on its board of directors, Musk said that vertically integrating the battery production makes economic sense.

‘The gigafactory will take that to another level,’ he said. ‘You’ll have stuff coming directly from the mine, getting on a rail car and getting delivered to the factory, with finished battery packs coming out the other side. The cost-compression potential is quite high if you are willing to go all the way down the supply chain.’

But the gigafactory will not just supply batteries for Tesla’s electric cars: Stationary battery packs will be provided to SolarCity, the San Mateo solar-installation company run by Musk’s cousins, and other renewable energy companies in the solar and wind industries.”