Tesla’s Mexico Gigafactory could add $15 billion to cross-border trade: Report

Tesla has finally announced it is building a factory in Monterrey, Mexico, and the potential economic impact of Tesla’s investment has been calculated. The factory could increase Mexico’s export to the US by 3.5% annually, or about $15 billion, as reported by Freight Waves.

Jordan Dewart, president of logistics company Redwood Mexico, described the expected impact of Tesla’s proposed $5 billion factory on inter-Mexico-US economic relations, “Tesla’s impact on Mexico can already be felt long before they actually open their Mexico Gigafactory. After Tesla’s move to Austin two years ago, many of their tier 1 and tier 2 suppliers either moved to Mexico to start new factory operations or greatly increased the size and scope of current operations.”

Dewart projects the Santa Catarina plant to impact logistics rates as demand rises. The facility will create up to 6,000 jobs in the first phase alone, with more as Tesla ramps production to one million EVs annually. It is scheduled to come online in 2024.

Another logistics expert, Jorge Canavati of J. Canavati & Co., expects freight volume between Mexico and the US to increase significantly, “The Tesla plant is going to cause much more freight between Texas and Mexico. In Monterey, you have various Tesla suppliers already there and there are going to be more. The regional impact is going to be just amazing.”

Tesla already has automotive suppliers, but the number is expected to increase four times. The American EV maker has begun recruiting for the new Gigafactory.

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