Tesla’s Plans to Build a Plant In Mexico Remain Shrouded In Secrecy

Eugenio Grandio, director of business development and policy for Latin America at the electric car maker, has refused to make any comments regarding the company’s plans to open a plant in Mexico

By

Mexico City — Tesla, Elon Musk’s electric car manufacturer, is looking to land in Mexico and build a factory in the country, but the company’s arrival remains shrouded in secrecy, both on the part of the government and the car maker, and amid contradictory statements by members of the government of President Andrés Manuel López Obrador.

The Foreign Affairs Ministry (SRE) this week presented the Mexico-US roadmap for electrification, with Stellantis, Toyota, Ford, General Motors and Nissan in the front row, and while Tesla was also present, the Texas-based company was not mentioned and appeared to seek a low profile amid questions its plans to set up a plant in the country.

Bloomberg Línea asked Eugenio Grandio, Tesla’s director of business development and policy for Latin America, about the company’s planned investments in Mexico, but he was tight-lipped and cautious with his words, saying he would not make any statements at that time, and that there was nothing to report.

Any investment news would be given by Tesla, he said, deflecting further questions.

A potential Tesla investment in Mexico gained momentum in the second half of last year when Musk visited Monterrey, the capital of the northern state of Nuevo León, to meet with state authorities and discuss the company’s projects in the state, which borders the United States.

The visit by the founder of Tesla and SpaceX stirred the spirits of the governor of Nuevo León, Samuel García, who on social networks celebrated the arrival of multi-million dollar investments to the state, although he did not specify which company he was referring to.

García, of the opposition Movimiento Ciudadano party, wants to turn Nuevo León into the center of electric mobility in Mexico, but the government of AMLO, as the president is known, is also in the fight to attract investments from the automotive industry.

On January 31, Reuters quoted presidential spokesperson Jesús Ramírez as saying that Tesla is considering establishing a plant near the Felipe Ángeles International Airport (AIFA) on the outskirts of Mexico City, one of AMLO’s flagship projects.

On the same day, Bloomberg quoted Ramírez as saying that Tesla is evaluating a range of investment options, including land near AIFA, and locations in Nuevo León and Sonora state.

Ramírez’s statements were not echoed by Mexican Foreign Minister Marcelo Ebrard, however, who attended a plenary meeting of Morena, the ruling party, in the Senate on January 31, and who was asked by Bloomberg Línea if Tesla was looking to build its plant near AIFA.

“I don’t know the location yet,” Ebrard said.

The following day, on February 1, Ebrard led an event at the SRE to present the roadmap for the transition of the automotive industry in Mexico and the United States.

Asked if Tesla is interested in investing in Mexico, and if the company is looking to build a plant close to AIFA, Ebrard said: “Yes, they are interested. We have been working with them for a year and a half, but I do not want to make any announcement, because it is up to them, but we have been working for a year and a half”.

Asked if the proposed location for the plant is close to AIFA or in Nuevo León state, Ebrard said, “I can’t say that, Tesla has to say it”.

Ebrard did say however that Tesla stated during the pandemic that Mexico is a reliable country that respects intellectual property, adding that there are 127 plants in Mexico that produce parts for Tesla.

“Tesla is already in Mexico. Now, probably, another investment will come, but let’s wait for them to say so,” Ebrard said.

Meanwhile, Alberto Montoya Martín del Campo, a commissioner for regulatory improvements, who attended the electro mobility event on behalf of state utility CFE’s chief executive Manuel Bartlett, spoke of the importance of the country’s energy transition. “For Mexico, the sovereign energy transition is an imperative,” he said.

He also spoke of plans to launch an energy transition this year, but bemoaned the fact that none of the new electric vehicles to be manufactured in the country will be Mexican.

Bloomberg Línea asked Martín del Campo about Tesla’s investment in Mexico, but the refused to discuss it.

Isabel Studer, director of the Mexico Alliance at the University of California, said however that, “it is not that the [energy] transition is going to happen, it is already happening”, pointing out that there are companies that have already invested in the production of electric batteries, in the extraction of essential materials such as lithium and in innovative businesses.