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Tesla Expanding Operations to Mexico
Elon Musk is reported to be meeting with Mexican president, Andrés Manuel López Obrador, today in order to discuss the plans and to announce its next Gigafactory location in Mexico. The date of the call will be late Friday afternoon. The exact location for the Giga factory is currently unknown, and Mexican Foreign Minister, Marcelo Ebrard, declined to comment on the location.
There are clues that told the story that this was going to happen. If you look at the image here for this article, there is a dedicated Tesla lane to Mexico - that was the first and biggest clue. This direct lane crossing from Texas to Mexico, to Nuevo León, was a big indicator this was going to happen.
The next clue was that other carmakers have successfully used Mexico as a building ground for their vehicles. This past success will help Tesla expand its operations.
In addition to that, Tesla has said they want to produce 20 million vehicles by 2030. In order to do that, they are going to HAVE to build new Giga factories. If Tesla isn't announcing new Giga factories, I would get worried as a Tesla investor and shareholder.
I expect that we'll hear more announcements of Giga factories each and every year until we get to the point that Tesla has covered the entire world with its vehicles.
What Will Be Built In Mexico?
Some have wondered if this news was going to be announced on Investor Day, on March 1, 2023, and that the President of Mexico may have jumped the gun with this news. Regardless, the news is out and Tesla will need to speak to it come March 1.
I believe that Tesla will build its Model 2 or compact car in this Giga factory. It will need to be a much smaller version of the Model 3 and be affordable to anyone in South America. This is a market that is largely untapped for EVs (electric vehicles). In Mexico, vehicles are generally about 5 to 10 percent cheaper than they are in the U.S.
Tesla will also need to start building out its Supercharger Network in Mexico, and it will most likely start with a central location where the cars are first built, just like they did with the first Supercharger in Thailand. There are about a dozen Superchargers in Mexico currently.
Beyond the compact car, I think Tesla could build out its solar and battery storage products. It would be great to see the solar roof and Megapack start to circulate in Mexico and South America. I think Tesla is going to try and get its Megapack product all around the world and not just for utility companies in North America.
This is great news and I expect Tesla to comment more on this on Investor Day on March 1st.
BREAKING: @Tesla has chosen Mexico as a location to expand its operations, and Elon Musk will speak with Mexican President Andres Manuel Lopez Obrador, Mexico's top diplomat said Friday. https://t.co/wliZEeMYiC— Sawyer Merritt (@SawyerMerritt) February 17, 2023
What do you think of Tesla expanding its operations into Mexico? What vehicles will be built there?
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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News.
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