Giant EV automaker Tesla announced it will invest US$3.6 billion to expand the facilities at its Gigafactory in Nevada, creating 3,000 new jobs and two new plants. These plants include the company’s first high-volume Semi factory and a 100 GWh 4680 cell factory, which will have a capacity to produce batteries for 1.5 million light duty vehicles every year.
Tesla first started operations in Nevada in 2014. Since then, the automaker has built a 5.4ft2 Gigafactory through a US$6.2 billion investment, creating 17,000 construction jobs and over 11,000 direct jobs at the company.
While Tesla remains as an industry leader in the electric car sector, traditional automakers have begun to heavily invest in these vehicles as electromobility becomes more popular, with Chinese automakers such as BYD increasing their market share every year. The growing popularity of other brands may be one of the reasons Tesla decided to cut prices in China, Japan, South Korea and Australia for the Model Y and Model 3 EVs, the company’s best-selling models, as reported by MBN. According to Statista, China is currently the world's largest EV market. With an expected annual growth rate of 14% between 2023 and 2027, this market is predicted to generate US$180.50 billion in revenue this year.
Elon Musk, CEO, Tesla, dismissed worries that a weak economy would stifle buyer’s interest, as the company’s price cuts have increased the demand for its EVs. Despite a sharp decline in its profit margins, the company slightly surpassed Wall Street revenue and profit forecast for 4Q22, according to Reuters.
Musk expects a “pretty difficult recession this year,” but added that the price cuts make a significant difference to the average consumer. He said that the demand for Tesla EVs “will be good despite probably a contraction in the automotive market as a whole.”
Earlier this year, there were rumors that Tesla might build a Gigafactory in Nuevo Leon, with an initial investment between US$800 million to US$1 billion. This investment would put Mexico closer to its objective of creating a robust and alluring lithium value chain, as reported by MBN.
Foreign Affairs Minister Marcelo Ebrard said that CEO Elon Musk traveled to three states in Mexico in search of the ideal location for a new factory. According to Reuters, Musk visited Nuevo Leon in October and met Governor Samuel García and US ambassador to Mexico Ken Salazar to talk about the plans and prospects.