AMLO discusses gigafactory plans with Tesla team

President López Obrador met with Tesla executives at the National Palace on Wednesday to discuss the company’s construction of a new electric car gigafactory in Nuevo León.

The meeting was attended by the Economy Minister, Raquel Buenrostro; Foreign Minister Marcelo Ebrard; Finance Minister Rogelio Ramírez de la O; and Germán Martínez Santoyo, head of the National Water Commission (Conagua).

“We met with Tesla executives and technicians. We advanced on the project of the automotive plant of Nuevo León and on others. We’re doing well,” AMLO said on Twitter.

Tesla’s huge gigafactory will be constructed in the municipality of Santa Catarina, about 17 kilometers from Monterrey, with an expected investment of US $5 billion. It will have the capacity to produce 1 million cars a year, which may include Tesla’s upcoming “Model 2”.

The factory is expected to employ around 6,000 people and create nearly 30,000 more indirect jobs. It will generate about 250 million pesos (US $13.8 million) in taxes for the municipality.

AMLO was previously skeptical of Tesla’s plans to invest in Nuevo León, citing the state’s historic water shortages. He suggested the southeast of the country as a more suitable location.

Despite these misgivings, the president announced a deal last week, under which Tesla will first conduct an evaluation of Nuevo León’s water supply to ensure the factory’s usage will not threaten local consumption.

Tesla sent between 30 and 50 people to the northern state this week to start preparing the area for construction. Specialists warn that leveling the ground will be a complicated process, as the area is “very rugged”.

Nevertheless, the governor of Nuevo León, Samuel García, said that construction was expected to start in April or May, and would proceed rapidly. It is hoped that the factory will be fully operational by the end of this year or early 2024.

“Today, work begins between the Tesla team, the state government team and the city team for the critical journey from here to the first stone of the Tesla gigafactory, which we hope will be in a month, maximum two and a half months,” said Jesús Nava, mayor of Santa Catarina.

Tesla also has plans for other investments in Mexico, according to Reforma newspaper, including an electric battery factory.

With reports from Reforma and Forbes

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