Tesla Inc. is considering opening a new plant in Mexico, according to an official from the country’s government, setting off a potential political firestorm due to its plans being seen as an example of companies taking advantage of lax labor laws in the region. The move would allow Tesla to access cheaper labor and resources for its operations, with company officials reportedly saying that they have been in talks with Mexican authorities in order to explore the possibility of opening a plant there. In order to gain more information on the situation, we have conducted research into this latest development and what it could mean for Mexico and Tesla going forward. Read on to find out what we discovered.
Tesla is considering building a plant in Mexico, an official says
Tesla is considering building a plant in Mexico, an official says.
The electric carmaker is looking at a number of sites in Mexico for a potential factory, according to a Mexican government official familiar with the matter.
Tesla is already building a factory in Nevada, and CEO Elon Musk has said the company plans to eventually produce 500,000 cars per year. It’s not clear if the Mexico plant would be used to supplement or replace production at the Nevada facility.
The company declined to comment on the report.
If Tesla does build a plant in Mexico, it would be the latest in a string of automakers that have set up shop there in recent years. Audi, BMW, Mazda, and Mercedes-Benz all have factories in Mexico, taking advantage of lower labor costs and trade agreements between the country and the U.S. and Europe.
The company has been in talks with officials in Mexico for months
Tesla has been in talks with officials in Mexico for months about the possibility of setting up a manufacturing plant in the country, a Mexican government official said.
The official, who spoke on condition of anonymity, said the talks were at an early stage and no decisions had been made.
Tesla declined to comment.
The company has been looking to expand its manufacturing capacity as it ramps up production of its electric cars. Earlier this year, it announced plans to build a factory in China.
A plant in Mexico could help Tesla lower its costs as it looks to become more competitive with established automakers. Labor costs are lower in Mexico than in the United States, and the country has a large pool of engineering talent.
Tesla is looking to take advantage of cheaper labor and production costs
Tesla is looking to take advantage of cheaper labor and production costs by considering building a plant in Mexico, an official said. The move would help the company lower its costs as it looks to ramp up production of its electric cars.
The potential Mexico plant would be used to build Tesla’s Model 3, which is slated to go into production next year. Tesla has said it wants to produce 500,000 cars per year by 2018, and the new plant could help the company reach that goal.
Tesla already has a factory in Fremont, California, where it builds its Model S and Model X vehicles. But with the launch of the Model 3, Tesla will need to increase its production capacity significantly.
Building a factory in Mexico would give Tesla access to cheaper labor and production costs than in the U.S. It’s unclear how much progress Tesla has made on the plans for a Mexico plant, or when it could be up and running if the company does decide to build one there.
