Elon Musk’s tunneling startup Boring Company is working with a Nevada state-affiliated group to study a tunnel project that would go under the nine-mile stretch of highway from Reno to Tesla’s Gigafactory, according to documents reviewed by Fortune.
The Economic Development Authority of Western Nevada (EDAWN), a non-profit that recruits companies to do business and expand in the state, paid Boring Company $50,000 in October to draw up conceptual designs and conduct a feasibility report for a new transportation alternative to the Tahoe-Reno Industrial Center, the mega-business complex that houses Tesla’s Gigafactory, according to a copy of the study invoice, which was obtained by Fortune via a Freedom of Information Act Request.
The potential tunnel project is one of several options various state groups are considering in order to alleviate the steep rise in traffic and accidents along Interstate 80 as more data centers and companies move into the 107,000-acre Industrial Center east of Reno and Sparks, Nev. Tesla and Panasonic, the two largest companies in the Center, have been in contact with the Nevada Governor’s Office since at least last spring about potential transportation solutions, according to emails, which were also obtained by Fortune via the FOIA request. Both Tesla and Panasonic are working with the local transportation agency to sponsor an ongoing study for a commuter rail system that would run on the freight rail next to the interstate. They also provided funding to EDAWN to look at other options, according to an email from Chris Reilly, Nevada Governor Joe Lombardo’s former infrastructure director, who introduced a Boring Company executive to leaders at Tesla and Panasonic to discuss the tunnel study.
It’s not clear if the report has been completed yet, and the specific details of the report—including the exact length of a proposed tunnel, the cost of the projet, and the types of vehicles envisioned for the tunnel, including the potential for autonomous vehicles—could not be learned.
Boring Company, which currently operates a small stretch of tunnel with Teslas underneath the Las Vegas Convention Center, has been trying to pitch a tunnel that would go out to the Gigafactory since at least 2019. “The Boring Company is extremely interested [in] building a Loop tunnel beneath I-80 out to the Tesla Gigafactory, but would need NDOT’s support,” reads a research report published by the Nevada Department of Transportation seven years ago.
Boring Company’s approach is novel, with small, single-lane tunnels made specifically for electric vehicles, and the Elon Musk-founded startup has struggled for many years to garner the political and regulatory support needed to undertake significant transportation projects. Even in Nevada, where Boring Company has successfully opened a tunnel system and begun chauffeuring passengers in Teslas in Las Vegas, the company has completed only four miles of operational tunnel and is currently experiencing delays as it tries to get necessary approvals to dig under land beyond the County and into the City of Las Vegas. The company is also reckoning with community blowback over safety and environmental issues during tunnel construction.
The prospect of a Reno tunnel is still very conceptual, and while more than 20 stakeholders—including city and county officials in the region—have been looped into conversations about a potential commuter rail alongside I-80, few of those parties have yet been roped into a potential Boring Co. project, according to two people regularly briefed on the progress of the rail study, including Bill Thomas, who runs the Regional Transportation Commission of Washoe County, the organization that spearheaded the commuter rail study and road studies.
“We did not commission it. We’re not paying for it. I’m not involved in it. But I understand there are conversations exploring whether that could be done,” Thomas says, noting that, while he doesn’t understand what the plan would be, he is supportive of any transportation alternative that could help alleviate traffic and reduce accidents along the Interstate. “If there’s a private solution that helps the problem and improves safety, as far as I’m concerned, more power to them.”
Representatives for Tesla, Panasonic, EDAWN, and the Governor’s Office did not respond to requests for comment on this story. Reilly declined to comment.
A traffic surge
Accidents and traffic have ramped up on I-80, which has two lanes going each direction—particularly since the construction of several data centers this past summer as part of Nevada’s push to draw more AI companies to the state. There are some 22,000 employees who work at the Industrial Center each day—70% of whom live in Reno or Sparks, Nev., according to a commuter rail study update report from March 2025 that was seen by Fortune. Nearly 8,000 of those people work for Tesla, and more than 4,000 at Panasonic, according to a second update report from October.
While the state’s Department of Transportation is currently in the process of widening the highway, that expansion will not start until the end of 2027 and will take a few years to complete. Companies in the Center have requested the Governor’s Office help them with alternative solutions, according to the emails. The number of vehicles traveling on stretches of the Interstate during peak rush hour doubled between January and July 2025, according to data pulled by the Nevada Department of Transportation that was shared with Tesla’s senior facilities manager and Reilly, the former infrastructure director for Nevada Governor Joe Lombardo. “We are looking for creative ways to improve the Waltham ramp,” a NDOT employee wrote to the Tesla manager and Reilly in an email.
RTC Washoe, the regional transportation commission in Western Nevada, began prioritizing transportation alternatives for I-80 about two years ago, according to Thomas. “At this point in time, there’s about [one accident] every other day,” Thomas says.
How effective the Boring Co’s tunnels would be at relieving the congestion is unclear and may depend on whether the tunnel is designed to function as a mass transit system, with a fleet of shared, centrally operated vehicles that commuters hop in and out of, or whether individuals drive their own cars through the tunnel. Boring Company’s 4-mile Las Vegas Loop is able to transport thousands of passengers per day during major conferences at the Convention Center, but those vehicles are operated by dedicated company-hired drivers. With individuals driving their own cars in a tunnel, the potential for accidents and other snafus would likely increase and raise the risk of a severe backlog in a single-lane tunnel.
Boring Company’s involvement may also draw criticism from the public—particularly after the startup was fined for dumping wastewater in Las Vegas and after firefighters were burned by chemicals in a tunnel during a training drill. A Nevada Congresswoman recently sent a demand letter to Nevada Governor Joe Lombardo, requesting more information on both incidents and requesting more information about his Office’s involvement in Nevada OSHA rescinding citations it had issued to the Boring Company last year.
This story was originally featured on Fortune.com
