Tesla secures incentive package for Giga Mexico

Tesla is set to receive an incentive of 2.63 billion pesos (approximately US$153 million/C$205 million) from the Mexican state of Nuevo León for its upcoming Gigafactory. The incentive package was approved by the state’s economic development council on Thursday.

According to a statement from the government, the incentives encompass a range of initiatives, including the creation of essential infrastructure such as roads and water treatment facilities. Additionally, Tesla will benefit from a reduction in payroll taxes. (via Bloomberg)

This incentive package comes after Tesla requested the government provide necessary infrastructure to the factory site. In October the government said it will commit more than $130 million to build infrastructure for water, electricity, gas, and transportation, and with today’s announcement made it official.

The Nuevo León state government this week also granted all the necessary permits for Tesla to begin construction of Giga Mexico.

When construction will actually begin is still up in the air. Tesla announced Giga Mexico in March, but unlike their other recent factory builds, there has been no progress at the site since then. In October CEO Elon Musk cautioned that the company was in no rush to build the factory, saying during the Q3 2023 earnings call there are other factors at play that have delayed the start of the project.

Tesla has committed to investing approximately $10 billion in the factory over several phases, with an initial investment of $4.5 billion. Giga Mexico, along with related suppliers, will inject around $15 billion into the local economy over the next two years.

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