Tesla’s Reputation Suffers in Mexico Over Factory Delays

Tesla's reputation in Mexico has taken a hit due to delays in constructing its factory in Nuevo Leon and the prices of its vehicles, according to a recent report by market research firm YouGov. 

The report shows a 4.9% drop in Tesla’s reputation, falling from 26.9% in September 2023 to 22% in April 2024. This decline is evident across various brand indicators, including a 0.9% decrease in the consideration for purchasing or recommending Tesla vehicles and a 1.1% drop in brand exposure among Mexican consumers.

The factory project, announced with much fanfare in early March 2023, initially boosted Tesla’s standing in Mexico. However, the lack of progress over the past year has dampened enthusiasm. As of April 18, 2024, Tesla’s Buzz score, a measure of public awareness and sentiment, fell to 15.7 points from 21.1 points in September 2023, a decrease of 5.4 points.

Other key metrics also showed declines:

• Impression: Down by 0.6 points

• Consideration: Down by 0.9 points

• Word-of-Mouth Exposure: Down by 1.1 points

• Ad Awareness: Down by 3.0 points

• Reputation: Down by 4.9 points

Tesla's reputation challenges are further compounded by recent workforce reductions and competition from other automakers. In April, 2024, Tesla announced the layoff of 2,688 employees from its Austin, Texas plant, including 300 Mexican workers. Additionally, the company removed the job listings for the Nuevo Leon plant from its website, leading to speculation that the job cuts might have included Eugenio Grandio de la Torre, Tesla’s market manager in Mexico.

Tesla faces additional competition from Chinese automaker BYD, which has entered the Mexican market. BYD began pre-selling its first sedan in March 2024 and is expected to announce plans for its own factory in Mexico by the end of the year. According to YouGov Profiles, Electric vehicle (EV) buyers in Mexico show a strong preference for domestically produced cars, with 40.3% of them considering foreign cars to be of higher quality.