Tesla plant in Mexico later and larger than expected
Tesla is reportedly planning to start up its new factory in Mexico in the first quarter of 2025, later and larger than previously announced. According to a Chinese media report, Tesla has given this date to several Chinese suppliers.
As the news website LatePost reports, Tesla’s Mexican plant will be larger than previously announced – Giga Mexico will have an annual production capacity of two million vehicles and create around 7,000 jobs. The total investment amounts to ten billion US dollars (currently 9.2 billion euros).
Several Chinese suppliers were cited in the report, saying that Tesla has told them that if they fail to get local production up and running in Mexico by 2025, it will not only be difficult to get a Giga Mexico order in the future but orders for other Tesla plants could also be lost. According to one supplier, the production costs for the same component in Mexico are about 15 per cent higher than in China. This means that the purchase price for Tesla would be around 18 to 20 per cent higher.
Tesla officially announced the factory in the Mexican state of Nuevo León at the beginning of March this year. At that time, there was talk of investments of five billion dollars and, a little later, a production capacity of one million electric cars per year. According to this latest unconfirmed information, the factory could be twice as large as previously expected.
At first, Tesla did not give any details on the start of construction or production in Mexico, but later it said that the factory could go into operation in the second half of 2024. Tesla manager Tom Zhu announced in March that production in Mexico would start in late 2024 or early 2025, which fits with the new information from China.
With the talks with Chinese suppliers that have now apparently taken place, Tesla wants to ensure that enough components will be ready for the start of production in about one and a half years. The model established at Giga Shanghai of sourcing over 95 per cent of the components locally does not seem to be applied in Mexico, at least at the start.
According to the LatePost, the construction of the factory appears to be proving more difficult than expected – hence the opening in 2025 and no longer in 2024. In contrast to Giga Texas, where work began within a few days of the announcement, so far not much has happened in Monterrey. The report cites logistical hurdles but also poorer existing infrastructure or higher labour costs. In this case, Tesla seems to be relying on proven suppliers for the moment.
Mexico is to become the first plant for the Tesla vehicles of the “Gen3” platform, but not the exclusive plant. After the launch in Mexico, Tesla will also use the platform in other gigafactories. For both new models based on the new platform combined, Tesla is reportedly aiming for annual sales of five million units, according to Elon Musk.