Elon Musk slows down his startup plan in Nuevo León

The future of the promised land of electric cars in Nuevo León is still uncertain. The disbursement of 10 billion dollars by the Tesla company, owned by Elon Musk, in the Neolonian municipality of Santa Catarina, still does not have a date on the calendar. The richest man in the world recently stated in an interview that the plant in Mexico will be the second line of a new low-cost electric vehicle, but said factory “will take a long time.” On the contrary, this new product of the company will begin to be produced in its gigafactory in Austin Texas.

During the presentation of the Cybertruck—Tesla’s new electric off-road vehicle—the richest man in the world did not briefly mention that this model low cost will have really high production volumes. “I think the manufacturing revolution that that car will represent will surprise people,” he said. Although the plans for a more accessible model for people have sparked interest in the union, it has also been confirmed that its start has been postponed in the billionaire’s schedule.

The Nuevo León megafactory, stridently announced last February by Governor Samuel García as a multimillion-dollar attraction that could keep pace with other Musk plants in the world, built in less than a year, still does not have a first stone on the ground. 1,300 hectares where the investment is supposed to be deployed. The controversial businessman had already commented during his last report to investors that, given the situation of the global economy, they would not go at full speed regarding his plans in Mexico. The delay of the works in the municipality of Santa Catarina, coupled with the lack of details from the company itself, have raised alarms about a possible lack of interest on the part of the owner of the social network X to launch his plans in the Latin American country.

Elon Musk and Samuel García, during a meeting in Austin (USA), on March 2, 2023.
Elon Musk and Samuel García, during a meeting in Austin (USA), on March 2, 2023. Government of Nuevo León

Local authorities have come out to insist that the ambitious project and spearhead in the automotive industry will see the light under their mountains. The Secretary of Economy of Nuevo León, Iván Rivas Rodríguez, stated before the State Congress that the company already has the land purchased and is in the process of obtaining federal permits. “We have very good communication with Tesla executives, we are constantly talking with them and soon the first stone will be (placed). They already have the federal and state permit process in order, it is just a matter of them deciding to make this investment,” reported Rivas Rodríguez when appearing before the local Congress for the Gloss of the Second Government Report.

The Government of Samuel García added that the works surrounding the megafactory, such as the expansion of the Free Highway to Saltillo and the construction of access and exit of vehicles for people, supplies and products to the plant, are being carried out because they are necessary for the municipality of Santa Catarina with Tesla or without Tesla. Sergio Argüelles, president of the Mexican Association of Private Industrial Parks, assured this week during an event to local media that the acquisition of the land by Elon Musk is a fact. “The 1,300 hectares already purchased are combined with the investment of suppliers installed in Monterrey,” concluded the industrial spokesperson.

Fernando Turner, an entrepreneur in the automotive sector and former Secretary of Economy of Nuevo León, warns that the factory will be able to land at some point in the State, but not at the speed that had been initially planned because the main market for electric cars , the United States, has not reached the expectations that were had two years ago. “This low demand means that the prices of the products cannot be sustained and the manufacturers do not have the same resources that they thought they would have. The Tesla plant may arrive, but not in such a hurry,” he commented.

Just this week, the federal Ministry of Economy included the Tesla production center in the portfolio of projects, valued at a total of 106 billion dollars in foreign direct investment, which will land in Mexico over the next three years.

The Nuevo León gigafactory has been one of the banners of the Government of Samuel García as a reliable result of the so-called nearshoring and the changes in supply chains that are benefiting Mexico and specifically the neighboring states on the northern border. The land chosen by Musk is located in Santa Catarina, a municipality with just over 310,000 inhabitants and just 380 kilometers from Austin, Texas, the epicenter of the Tesla emporium’s operations. For experts in the sector, the message is clear: Musk has not given up his intention to reach Mexico, but he will not turn on the engines of this manufacturing center until demand forecasts increase.

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