Tesla is planning to build a new factory in Mexico, joining other carmakers bulking up their presence south of the US border.
Mexico President Andres Manuel Lopez Obrador said the plant for the electric car firm would be in Monterrey, which is about a nine-hour drive from Texas.
Tesla is expected to share more in presentation to investors on Wednesday.
Mexico had previously raised concerns about how water demands from the factory might affect the region,
But Mr Lopez Obrador said he had won commitments from Tesla boss Elon Musk that had helped ease those worries.
Mexico is trying to position itself as a winner as tensions between the US and China disrupt traditional supply chains.
“This will represent a considerable investment and many, many jobs,” Mr Lopez Obrador said at a news conference on Tuesday.
US President Joe Biden has emphasised made-in-America rules for cars to qualify for new subsidies included in a massive spending plan approved to tackle climate change last year.
But the rules provide exceptions for Mexico and Canada.
This would be Tesla’s third factory outside of the US, after the firm opened plants in China and Germany in recent years.
The company did not respond to a request for comment on its latest move.
The confirmation of Tesla’s plans comes just a few weeks after BMW said it would be investing in a factory in Mexico. Ford also manufactures its electric SUV in the country.
General Motors announced plans to build a plant for electric cars in Mexico last year, prompting the United Auto Workers trades union to describe the decision as a “slap in the face”.
Source: bbc.com
