Elon Musk is seen leaving the “AI Insight Forum” in Washington DC on September 13. Nathan Howard/Getty Images
In May, Elon Musk said he would likely select a destination for a new Tesla (TSLA) factory by the end of the year. This is a move closely watched by Tesla investors and customers because where the company goes next could have a big impact on its future as well as the region’s economy.
Tesla currently has six Gigafactories globally: four in the US, one in China and one in Germany. Four of them assemble electric vehicles. Musk has listed Canada, Mexico, India and China (again) as possible destinations for the next Tesla Giga. Meanwhile, countries that remain off Musk’s radar are courting Tesla with financial incentives in hopes of boosting their economies.
On Sunday (September 17), during a meeting with Musk in New York City, Turkish President Recep Tayyip Erdogan invited the Tesla CEO to build a new plant in Turkey, the country’s state news agency Anadolu reported today. . Erdogan is in New York this week to attend the United Nations General Assembly.
According to Anadolu, Musk responded diplomatically that Turkey is “one of the most important candidates” for his next factory.
In August last year, evidence emerged that Musk was eyeing Canada after the US’s newly enacted Inflation Reduction Act limited electric vehicle tax credits for vehicles produced in North America. Tesla already has a facility in Markham, a city in the Canadian province of Ontario, that manufactures assembly line machinery for Tesla Gigafactories around the world.
In June 2022, Musk told Tesla employees that he was looking for additional factory sites in North America. Mexico was also on his radar. At Tesla’s investor day event in March this year, Musk announced plans to build a factory in northern Mexico to produce its next generation of cheap electric vehicles. The timeline for construction and operation is unclear.
India is another potential destination due to its low labor costs and huge consumer market. The Indian government is keen to grow the country’s electric car market as part of its clean energy initiatives. Reuters reported in August that Musk had reportedly spoken to Indian government officials about opening a facility to produce low-cost electric vehicles in India.
The Wall Street Journal reported yesterday that Tesla is also in early-stage talks with Saudi Arabia to set up a manufacturing facility there. but musk refuted the report In a tweet.
How does Tesla select factory sites?
Like traditional automakers, Tesla’s rationale for selecting factory sites begins with its intention to sell locally manufactured cars. In 2018, Tesla chose China as the destination for its first overseas factory due to the country’s huge auto consumer market. He chose Germany in 2020 for this reason.
Musk tweeted Tesla in May 2022 Shall not establish any manufacturing facility In a country where it is not allowed to sell and service its cars.
Tesla’s presence in India and Türkiye is currently limited. The company began taking orders from Turkey for the first time in April, with the Model Y being the only available vehicle. Teslas are still not available in India due to the country’s high import duties on foreign passenger cars.
However, Musk has said that a factory in India is “quite likely” unless the Indian government lowers auto import duties or imposes “temporary tariff relief” on electric vehicles.
Government subsidies and tax benefits may also influence Musk’s decision. When Tesla was selecting factory sites in China, the local government of Shanghai stood out from competing cities by offering Tesla generous tax benefits along with other incentives.
Turkey, whose economy has been in a downward spiral in recent years due to high inflation and the government’s reluctance to tighten monetary policy, will invest up to $1.5 billion annually to revive the country’s manufacturing sector, according to the US Commerce Department. Expected to do. Government spending could benefit Tesla if it opened an auto factory there, though it’s not yet clear how.
At yesterday’s meeting, Erdogan also proposed cooperation opportunities between Musk’s rocket company SpaceX and Turkey’s government space program and invited the billionaire to attend Technofest, Turkey’s biggest aerospace and technology festival, starting later this month. Invited for.
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Source: finance.yahoo.com
