The state of Nuevo Leon in Mexico will be the site of Tesla’s upcoming Gigafactory. Andres Manuel López Obrador, the president of Mexico, first broke the story yesterday, and Tesla has since verified it. Tesla’s sixth Gigafactory will be this one.
As they enter a new location to make their own automobiles, Tesla will strive to replicate its success with Gigafactories Shanghai and Texas to get production online pretty rapidly.
Elon Musk, the CEO of Tesla, announced during the company’s Investor Day that its upcoming Gigafactory would be located in Mexico, calling the news the most important one made that day. According to the reports, the facility will be constructed in Nuevo Leon, a country that has a thin border with Texas.
Once completed, the factory, which will cost more than $5 billion, would be the largest production facility for electric vehicles in the world. This will complement the output of all the other factories, according to Musk.
The new plant will be erected 387 miles distant from Tesla’s corporate headquarters and the Austin Gigafactory, as revealed by Mexican President Andres Manuel Lopez Obrador yesterday.
After months of rumors and discussions between the CEO and the President, Musk finally confirmed the news and made a public statement about its intentions for a new Gigafactory in Mexico the day after the president’s declaration.
Tesla also succeeded in negotiating an arrangement that will make transport between the locations efficient before this news was made public. Those crossing the border between Texas and Nuevo Leon were informed about this arrangement in previous months, according to the reports.
According to Nuevo Leon Economy Minister Ivan Rivas, a Tesla-branded car and the truck lane were visible at the border as the firm and the government reached this agreement to shorten wait times for cargo being shipped at the border. Moreover, Tesla works with a number of local vendors.
Before settling on Nuevo Leon in December, Musk had first chosen three different Mexican states. The Verge reported that the projected cost at full maturity will be $10 billion, despite the initial investment being touted to be between $800 million and $1 billion.
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According to Martha Delgado, the deputy foreign minister, Nuevo Leon was chosen for the factory because of its proximity to the Austin headquarters. This facility will only employ 5,000 to 6,000 employees, in contrast to other facilities that hired 10,000 workers for their own gigafactories.
Guillermo Rosales, the executive president of the Mexican Association of Automobile Distributors, has expressed support for this idea.