In front of a pile of cement blocks, with the sun in his eyes, the governor of Nuevo León, Samuel García, posed for the cameras on the land that will be a computer factory.
The Noah Itech company is one of several technology companies that supply Tesla, the pioneer of electric cars worldwide, and that last January, with this ceremony, formally celebrated its arrival in Mexico.
“This announcement serves me for three reasons,” said García at the Vynmsa industrial park, “one, to confirm that they invested in the best state to invest in;
second, the commitment to carry out all the public works necessary to have the best infrastructure;
and third, not to stop showing off Nuevo León to the whole world”.
His offer goes beyond rhetoric.
In addition to legal guarantees,
García offers foreign companies that settle in his State to cross one of the border bridges without tolls.
These costs are borne by Nuevo León.
The arrival of Noah Itech is part of a domino effect triggered by Tesla in late 2021, when CEO Elon Musk managed to move his operations from Palo Alto, California to Austin.
One of the great incentives that Texas offers businesses is low taxes.
In that country, as in Mexico, the States compete for investment from corporations, which generate jobs, and offer as much stimulus as possible.
Tesla's resources are among the most coveted, as it is a company with its own technology that employs well-trained, innovative professionals at competitive salaries.
From 2021 to date, many of the companies that supply and supply Tesla as part of its value chain have also moved to be closer to the new operation in Texas.
This created opportunities south of the border in Nuevo León, where labor is cheaper than in the United States and infrastructure is relatively good.
This is why when Musk announced in August of last year that he wants to open a giant new factory, Nuevo León emerged as a viable option.
According to local media, the construction of the factory required an area of 800 hectares and an investment of more than 10,000 million dollars in different stages.
After a discreet visit by Musk to the capital Monterrey in October of last year,
Now, the story of the possible Tesla factory in Mexico has turned into the political arena.
First, the spokesman for the presidency, Jesús Ramírez, told the
Reuters
agency on January 31 that Tesla is considering locating near one of the emblematic works of President Andrés Manuel López Obrador, the Felipe Ángeles International Airport (AIFA).
Reuters
also quoted a government official in its report, who said he had been shown the site, but the company had given no information about his plan.
This Wednesday, when asked about Tesla, President López Obrador briefly confirmed the competition between states for the investment.
"There are two possibilities, as I have been informed, that it be installed in Nuevo León or in Hidalgo, very close to the Felipe Ángeles Airport."
That Tesla would benefit from being near an airport is unclear.
In Nuevo León, the company already has an exclusive lane on the Colombia border bridge and the state government has offered it a second lane as part of the incentive package, according to a source with knowledge of the negotiations.
The Hidalgo Secretary of Economic Development, Carlos Henkel Escorza, has confirmed that they have been in contact with Tesla executives to attract this mega-plant to their territory.
Although for confidentiality reasons, the official cannot share the details of the negotiations, he has confirmed to EL PAÍS that incentives have been offered to the firm and that they expect a response no later than next April.
“I cannot give more details, but there will always be incentives for any company that comes to our State to invest, for us it is very important to detonate the industrial area.
Henkel Escorza also guarantees that they will have the electricity supply and the necessary land to house a mega-investment like Musk.
"Today we have the property of more than 900 hectares in the municipality of Zapotlán de Amores and 600 hectares in the Platah industrial park and with the great communication routes to Mexico City, progress is being made in the electrical infrastructure, this gives us the opportunity to receive large companies”, he adds.
Asked if its distance from the northern border is a disadvantage compared to other proposals such as Nuevo León, the secretary assures that it will be the company's analysts who will have the last word.
The Trump background
What the Mexican presidency has done by publicizing this competition for investment is making visible a bid that usually takes place behind closed doors and López Obrador is not the first president to do so.
In 2016, the then president of the United States, Donald Trump, criticized the automaker Ford for its intention to open an assembly plant in Mexico, which would have brought 700 jobs.
Under presidential pressure, Ford canceled its plans in Mexico and announced the opening of a plant in the State of Michigan.
José Zozaya, executive president of the Mexican Association of the Automotive Industry (AMIA), celebrates the regional competition that has been triggered in the interior of the country to capture this mega-investment in his territory.
“Competition between States forces them to be more efficient, to a greater respect for the Rule of Law”, he comments.
The AMIA leader acknowledges that despite the competitive advantages that the country already has to attract this type of project, such as the strategic geographic location, infrastructure, and skilled labor, the Government still needs to work on greater promotion of investment, incentives and guarantees of inputs such as electricity.
“In some regions of the country, I have been told about some cities where they are no longer receiving another plant because they do not have electricity capacity, but it is important that Mexico continues to increase its electricity generation capacity.
The Government should be much more promoter of investment with more incentives.
It is unfortunate that we see that some plants have gone to the US even though they were considering Mexico”, he ditch.
For Fernando Turner, executive director of Katcon, a manufacturer of exhaust systems and catalytic converters in Nuevo León, there are still pending issues for both the federal Administration and local governments to consider whether or not to land in Mexico.
The biggest lags, he warns, are related to the availability of financing, the lack of a cutting-edge technological policy and greater infrastructure, including in this last point, the electricity supply.
“The CFE is responsible for electricity transmission and businessmen are afraid that there will be no electricity, that would remove a lot of doubts from investors.
For now there is still a supply of electricity, but there is concern about whether in the future there will be a supply for everyone”, he comments.
Musk is now in a difficult position: If he goes ahead with his plans to locate in Nuevo León, he could irritate López Obrador, a president who routinely criticizes companies, foreign and local, during his daily press conferences.
Business consultants have warned for years that this practice has hardened the business climate, generating mistrust among investors.
Tesla intends to increase its production by 20 million electric vehicles by the end of the decade, which requires the installation of some eight mega-plants, and Mexico does not want to be left out of this ambitious goal.
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