Mexico City, Mexico — Following Tesla CEO Elon Musk’s announcement that he will suspend construction of a Tesla gigafactory in northern Mexico until after the U.S. elections, President Andrés Manuel López Obrador said it was “not serious.”
Musk’s announcement, which stems from Presidential Candidate Donald Trump’s stringent trade policies, does not worry Mexico’s President, who said it is unsustainable for U.S. automakers and consumers to move production out of Mexico.
“This really is not serious,” said AMLO. “(The U.S) has great experience in producing automobiles, but because their production costs are very high in the United States, it would affect their consumers.”
During Tesla’s Q2 earnings call on July 23, billionaire Musk said the plan to build Tesla’s “gigafactory” in Mexico had to be stopped and wait until after the U.S. elections, as Donald Trump’s promises to impose tariffs on cars produced in Mexico caused concerns.
“I think we need to see just where things stand after the election. Trump has said that he will put heavy tariffs on vehicles produced in Mexico. So it doesn’t make sense to invest a lot in Mexico,” said Musk in front of analysts and the media.
Musk first announced the construction of Tesla’s gigafactory in Monterrey, Nuevo León, in northeast Mexico in March 2023, after speculation and initial doubts over the region’s water scarcity and poor infrastructure.
At the time, the Mexican government welcomed the announcement with excitement, with Nuevo León’s government putting forward USD $153 million in incentives for Tesla to build the infrastructure and roads necessary to begin constructing the USD $5 billion factory.
Although Trump has only promised a specific 100% tariff for Chinese cars produced in Mexico, the Republican has drawn concerns amongst investors for his protective economic stance, urges to “shut down” the border, and campaign promises of holding employment in the U.S.
“This statement made by Trump is made within the framework, as we have always said here, of the campaign, and in campaigns, there is a lot of passion, rhetoric, and too much talk,” said López Obrador.
Mexican President-elect Claudia Sheinbaum, however, said Musk’s announcement could not be entirely related to Trump’s threats.
“We have to see the issue of Tesla in Mexico because since the announcement was made to date, there has not been much progress; then we have to see if the reason is the election and what Trump said in his candidacy for the presidency or maybe other reasons particular to Tesla,” she said.
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