Tesla, a manufacturer of battery and electric vehicle (EV), has announced its plans to build a $5 billion EV gigafactory in Mexico. This makes the company the second in the country to launch large-scale battery production in pursuit of the US’s Clean Vehicle Credit scheme. The facility will be constructed near Monterrey. 

Tesla already operates plants in Berlin, Germany; Shanghai, China; and California, New York, and Nevada, US. The Mexico project will benefit from the US government’s Clean Vehicle Credit, which only applies to vehicles completed in the US, Puerto Rico, Canada, or Mexico. The plan seeks to increase domestic production of EVs and batteries.

Reportedly, Tesla is not the only car manufacturer to invest in Mexico recently. In February 2023, BMW announced an investment of $866 million in EV and battery production in the central state of San Luis Potosi. In 2021, General Motors also announced an investment of more than $1 billion in Mexico to produce EVs.