Mexico’s President Says Tesla Building Mexican EV Plant

Matt Posky
by Matt Posky

On Tuesday, Mexican President Andres Manuel Lopez Obrador announced that Tesla will be building a plant south of the border. Confirmation comes following a call with CEO Elon Musk – held on Monday – with promises that the American company would be issuing a series of commitments designed to address regional water scarcity. The alleged plant is said to be located in Monterrey, which has historically struggled to cope with drought. 

While there has been no official word from Tesla, López Obrador has already stated that the company would address water shortages in public statements – important considering he previously opposed EV factories being built in the northern state of Nuevo Leon due to prospective water issues.

“There is one commitment that all the water used in the manufacture of electric automobiles will be recycled water,” the president said in a release.

From the Associated Press:

The president said it would be a large investment without giving a dollar amount, and did not specify what the plant would produce. He said it was unclear if it would produce batteries, an industry Mexico desperately wants despite not having any current domestic supply of lithium.
“This is going to mean a considerable investment and many, many jobs,” López Obrador said. “My understanding is that it will be very big.”
Monterrey is highly industrialized and close to the U.S. border, and had long been considered the frontrunner for any Tesla investment.

The factory would become Tesla’s first south of the U.S. border and an essential component of Musk’s plans to expand global manufacturing – which already has new plants being built in Texas and Germany. While there’s always a chance the deal could fall through, Mexico’s president seems incredibly optimistic about the project.

“He was very responsive, understanding our concerns and accepting our proposals,” López Obrador was quoted as saying by Automotive News. “I want to thank Mr. Elon Musk for being very respectful, attentive and understanding of the importance of addressing the problem of water scarcity.”

Tesla’s annual investor day takes place on Wednesday, so there should be a string of important announcements taking place – including the first glimpse of its Gen 3 vehicle platform. According to the Mexican president, the automaker will also be providing details about its arrangement with Mexico and the general scope of the factory.

[Image: Sheila Fitzgerald/Shutterstock]

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Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • SCE to AUX SCE to AUX on Mar 01, 2023

    "...which already has new plants being built in Texas and Germany"

    They are already built, and so is Shanghai. But the expansion never stops.

    Perhaps the mythical Model 2 will come from Mexico. And, perhaps there was a backroom deal with the US government to have it qualify for the EV subsidy Tesla lobbied against. This would make the cheapest Tesla cost less than a Corolla.

    • See 2 previous
    • Jeff S Jeff S on Mar 01, 2023

      U.S. Mexico Canada Agreement (USMCA) covers all vehicles made in North America so no backroom deals are necessary. Vehicles made in Mexico and Canada under this agreement are considered the same as those made in the United States meaning any subsidies or EV tax credits would apply to any North American assembled vehicles and legislation such as the Chicken Tax assessed on imported trucks would not apply to any vehicles assembled in North America.

  • Art Vandelay Art Vandelay on Mar 02, 2023

    Like a normal Tesla, but it has a Mexican Radio

  • Rust-MyEnemy Whoa, what the hell is wrong with Jalop1991 and his condescension? It's as if he's employed by Big Plug-In or something."I've seen plenty of your types on the forums....."Dunno what that means, but I'm not dead keen on being regarded as "A type" by a complete stranger"" I'm guessing you've never actually calculated by hand the miles you've driven against the quantity of gas used--which is your actual miles per gallon."Guess again. Why the hell would you even say that? Yes, I worked it out. Fill-to-fill, based on gas station receipts. And it showed me that a Vauxhall Astra PHEV, starting out with a fully charged PHEV battery, in Hybrid mode, on my long (234-mile) daily motorway daily commute, never, over several months, ever matched or beat the economy of the regular hybrid Honda Civic that I ran for a similar amount of time (circa 5000 miles)."You don't use gasoline at all for 30-40 miles as you use exclusively battery power, then your vehicle is a pure hybrid. Over 234 miles, you will have used whatever gas the engine used for 200 of those miles."At least you're right on that. In hybrid mode, though, the Astra was using battery power when it wasn't at all appropriate. The petrol engine very rarely chimed in when battery power was on tap, and as a result, the EV-mode range quickly disappeared. The regular hybrid Civic, though, deployed its very small electric reserves (which are used up quickly but restore themselves promptly), much more wisely. Such as when on a trailing throttle or on a downward grade, or when in stop-start traffic. As a result, at the end of my 234 miles, the Civic had used less gas than the Astra. Moreover, I hadn't had to pay for the electricity in its battery.I look forward to you arguing that what actually happened isn't what actually happened, but I was there and you were not."Regardless, that you don't understand it appears not to have stopped you from pontificating on it. Please, do us all a favor--don't vote."You really are quite unpleasant, aren't you. But thanks for the advice.
  • Tassos Jong-iL Electric vehicles are mandated by 2020 in One Korea. We are ahead of the time.
  • 1995_SC Can you still get some of the tax credits under the new program?
  • Analoggrotto HyundaiGenesisKia saw this coming a long time ago and are poised for hybrid and plug-in hybrid segment leadership:[list=1][*] The most extensive range of hybrids[/*][*]Highest hybrid sales proportion over any other model [/*][*]Best YouTube reviews [/*][*]Highest number of consumer reports best picks [/*][*]Class leading ATPs among all hybrid vehicles and PHEVs enjoy segment bearing eATPs[/*][/list=1]While some brands like Toyota have invested and wasted untold fortunes into full range electric lineups HyundaiKiaGenesis has taken the right approach here.
  • EBFlex The answer is yes. Anyone that says no is just….. wrong.But the government doesn’t want people to have that much freedom and the politicians aren’t making money off PHEVs or HEVs. So they will be stifled.