Tesla factory plans for Mexico are firming up, report says

Tesla Inc. and the Mexican border state of Nuevo Leon are firming up plans for a factory site in an automotive corridor that is home to assembly plants for Kia and General Motors, according to sources quoted by the Milenio newspaper.

Tesla CEO Elon Musk and the state government are "fine-tuning the final details," Milenio said this week, "in order to announce the installation of a factory in the state, which is expected to be made public in early 2023."

Tesla, which has disbanded its press office, didn't respond to an email seeking comment. The media office for the state of Nuevo Leon, which borders Texas, didn't respond to a phone call seeking comment.

Milenio said land near Monterrey, the Nuevo Leon capital, had been chosen for the plant. "The sources said the land for the plant had already been acquired and there is a commitment to finalize the investment in early January," the newspaper said. Nonetheless, Milenio said it couldn't find records of a land sale in public documents.

Nuevo Leon Gov. Samuel Garcia had hinted this month that record business investments would be coming to the state, but he said he was bound by nondisclosure agreements to keep the details confidential until later.

In October, Musk was spotted with Nuevo Leon officials at an event in Monterrey.

At that time, Milenio published a photo of him standing on a patio with Nuevo Leon first lady Mariana Rodriguez and reported that the tech billionaire had met with Garcia and local economic development officials "to analyze the possibility of installing a Tesla plant."

Other Mexican media suggested the talks with local officials could be focused on creating a Tesla parts assembly corridor for export or for expanding relationships with local parts suppliers.

Tesla has a new assembly plant in Austin, Texas, that could be easily fed from northern Mexico.

Musk said this year that the automaker could announce plans for a new plant by the end of 2022, but he did not give any indication where Tesla was looking.

The Texas-Mexico border area is home to hundreds of auto parts manufacturers, along with a major GM plant in Ramos Arizpe and a sprawling Kia Corp. plant just outside Monterrey. The GM plant is retooling to make its first electric vehicles.

The Mexican financial newspaper El Economista reported in April that Garcia had visited Tesla's Austin plant to cement an agreement for parts suppliers to use a Nuevo Leon border bridge for exports to Tesla plants in California and Texas.

Last year, Mexico exported just over 2.7 million vehicles, mostly to the U.S.

As the North American auto industry shifts from internal combustion vehicles to EVs, Mexico is seeking to draw more EV assembly and parts investment. Ford currently makes the electric Mustang Mach-E at a factory near Mexico City.