U.S. Markets closed

Tesla settles on Nevada for battery factory: source

A Tesla Motors logo is shown at a Tesla Motors dealership at Corte Madera Village, an outdoor retail mall, in Corte Madera, California May 8, 2014. REUTERS/Robert Galbraith

DETROIT (Reuters) - Tesla Motors Inc (TSLA.O) is finalizing terms of a deal to build its first lithium-ion battery plant in Nevada and will make an announcement about the deal on Thursday, a person familiar with the matter said.

The California-based electric car maker is working on the details, but all signs point to Nevada as the choice for the company's "gigafactory," said the person, who asked not to be identified.

Nevada Governor Brian Sandoval will hold a news conference on Thursday in Carson City, Nevada to make a "major economic development announcement," according to a media advisory from the state. Tesla spokesman Simon Sproule declined to give details but confirmed Tesla officials would be at the event.

CNBC earlier reported that Nevada was the winner among several states in line to be the site of a $5 billion plant to build cheaper and more efficient battery packs for its future electric cars, citing a source from the governor's office. State officials were not immediately available to comment.

Tesla had previously announced a partnership with Japanese electronics giant Panasonic Corp <6752.T> to open its envisioned battery factory in the United States in 2017.

Tesla said in July it had broken ground near Reno, Nevada, for a possible factory but was still in talks with several states before a final site was selected. It had previously outlined a plan to develop multiple sites at the same time to minimize the risk of delays.

(Reporting by Ben Klayman in Detroit and San Francisco newsroom; Editing by Meredith Mazzilli and Jonathan Oatis)