López Obrador confirms that Tesla will build an electric car plant in Nuevo León

The State of Nuevo León will be the headquarters of electric cars in Mexico.

The richest man in the world, according to Bloomberg, Elon Musk, has opted for the northern city of Monterrey to start his factory.

After weeks of political uproar and competition between states to attract the long-awaited investment from the owner of Tesla, the president of Mexico, Andrés Manuel López Obrador, has announced the company's decision in favor of the north of the country, although he has not revealed the investment amount.

The president indicated that the details will be announced by the company this Wednesday as part of its

However, he has stated that it is a "considerable" amount and has thanked the billionaire for his upcoming arrival in the country.

"The entire Tesla company is coming, the matter of the batteries was pending, but the entire automotive plant, which is going to be very large," he declared on Tuesday at the National Palace.

López Obrador has detailed that Musk was contacted a couple of times by video calls to close the deal.

“Things are going well, we talked with Elon Musk, the director of Tesla, there is already an understanding, if they are going to dedicate the investment in Mexico and the plant is going to be established in Monterrey, with a series of commitments to face the problem of lack of water".

The Executive has said he is satisfied with what was achieved, although he also recognized that the start-up of the factory will not be in his Administration.

"I do not want to expand the information any further, I think that this announcement will be made public tomorrow by the company and also some commitments will be made known and other commitments next week", he specified.

Lopez Obrador, however,

He explained that for the attraction of this series of factories that will involve a battery production center, for example, no additional incentives had to be granted.

According to sector specialists, the investment will be around 10,000 million dollars in different stages.

Tesla's landing in Mexico began to echo last October, when some photographs of the billionaire in Nuevo León were revealed.

Musk visited the Northern State for a few hours to see first-hand the possibilities of installing a new electric car plant in Santa Catarina, a municipality with just over 300,000 inhabitants and only 380 kilometers from Austin, Texas, the epicenter of the operations of the emporium of Musk.

But the Tesla owner did not stick exclusively to that one location.

Months later he revealed that his entourage had also flown over the State of Hidalgo months later, where they offered him some 800 hectares to establish his plant.

The secretary of Economic Development of Hidalgo, Carlos Henkel, previously confirmed to EL PAÍS the approach with the Tesla executives.

The political battle for Musk's resources was fueled when President López Obrador himself announced his preference for the megaproject to reach the center or southeast of the country and not the northern lands of Nuevo León, where Samuel García, from Movimiento, now governs. Citizen.

The availability of water in the north of the country focused the debate on the feasibility of hosting a plant of these dimensions.

“If there is no water, the permits will not be issued.

It is not feasible,” López Obrador said last week.

In line with the global green trend that has made electric cars gain ground over combustion cars, plants such as Audi or BMW in Mexico already have production lines for this type of unit.

Mexico has had an internationally relevant automotive corridor for years.

The country is the seventh producer of vehicles -above Brazil and Spain- and is the fifth exporter in the world, according to AMIA figures.

The installed production capacity of more than five million vehicles per year and, until 2021, more than 90% of the light vehicles produced in Mexico were for export, with the United States being the main destination.

Tesla closed 2022 on the right foot.

The company increased its profit by almost 60% in the fourth quarter, up to 3,700 million dollars, and for the year as a whole, it doubled its profits, up to 12,556 million, which will place it as the American car company with the highest profits, ahead of General Motors (GM) and Ford.

In their most recent conference with investors, the managers of the technology firm unveiled their strategy for 2023: Accelerate cost reduction and move towards higher production rates.

This year alone they plan to produce 1.8 million electric cars.

The goal is to reach 20 million vehicles in 2030, which would make it the clear world leader in sales.

The plant in Monterrey will play an important role in the roadmap to achieve these objectives.

subscribe here

to the EL PAÍS México

and receive all the key information on current affairs in this country