Tesla to build in northern Mexico, nation’s president says

Tesla will build a plant in Monterrey, Mexico, the nation’s president announced.

The decision, which President Andres Manuel Lopez Obrador said the electric-car company will detail on Wednesday, would help Mexico build on the millions of combustionengine vehicles that the country supplies to the U.S. every year. American and European manufacturers have thus far destined most of their EV factories for the U.S. market in American states, though BMW and General Motors have announced new investments in Mexico to ramp up EV exports to the U.S.

The arrival of Tesla in Mexico is also a feather in the cap for Lopez Obrador, though he didn’t get his wish for the factory to be located in an economically deprived state in the south of the country. The president said he wrung environmental commitments from Tesla Chief Executive Officer Elon Musk on a phone call Monday, including using recycled water throughout the manufacturing process — a pledge that Lopez Obrador sought for a region where water has become scarce.

“He was very responsive, understanding our concerns and accepting our proposals,” said AMLO, as the president is known for short. “I want to thank Mr. Elon Musk for being very respectful, attentive and understanding of the importance of addressing the problem of water scarcity.”

Lopez Obrador had said as recently as last week that Tesla wouldn’t receive permits if there wasn’t enough water in the area of the factory site. Last June, authorities were forced to cut water access in Nuevo Leon, where Monterrey is located, to a maximum of seven hours as dams were at risk of emptying entirely.