In Mexico, a state governor declared on Monday that Tesla (TSLA.O) and its suppliers would invest $15 billion over the following two years in a factory that is still being built, which is triple the amount that Mexican officials had before declared.
Elon Musk, the CEO of Tesla, announced in March that his company would establish a gigafactory in northern Nuevo Leon state as part of an effort to increase its global presence.
Musk did not disclose Tesla’s investment at the time, but Mexican officials said the factory would cost $5 billion.
Governor of Nuevo Leon Samuel Garcia stated the plant will now employ triple that amount while speaking at an event.
A request for comment regarding the governor’s remarks was not answered after business hours by either the Tesla press office or Nuevo Leon officials.
The governor stated that “just Tesla and its suppliers will generate an investment of $15 billion in two years,” and that this “enormous amount” will need more state spending on roads and other public works.
Prior to Tesla’s announcement earlier this year, major international automakers BMW, General Motors, and Ford all declared plans to start or increase electric vehicle production in Mexico’s enormous automaking sector as the industry transitions away from fossil fuel-powered vehicles.
Although the business has not specified a start date for the building of its gigafactory or when output will be operational, sources had previously informed Reuters that Tesla aimed to start manufacturing in Mexico in 2025.
Previously, Tesla (TSLA.O) was planning to start production at a sizable new factory in Mexico in 2026 or 2027, according to a report that appeared in the Mexican newspaper Reforma on Wednesday.
Earlier, many sources told Reuters that Tesla intends to start manufacturing in Mexico in 2025.
A timeframe provided by the Danish engineering firm Ramboll, which took the application procedure into account, indicated that the site wouldn’t be ready for building until 2027.
The debut of the new Model 3 sedan earlier this month was the first time the manufacturer released a vehicle in China before the United States, highlighting its growing dependence on the nation where it is in a battle with BYD (002594.SZ) for market share.
The car’s starting price in China was 12% more than the previous base model, and it was being produced at Tesla’s Shanghai factory. Additionally, it will be shipped to markets in the Middle East, Asia, and Europe.
The Model 3, Tesla’s second-best-selling model after the Y, could have had its base price increased to help safeguard margins. But the price reductions for its more expensive vehicles illustrate the fierce competition that EV manufacturers, particularly in China, face.
