It’s official: Tesla pauses its factory project in Mexico. The American automaker anticipates a potential victory by Donald Trump and the repeal of the Inflation Reduction Act (IRA).
The hot and cold winds of candidate Trump
To expand its operations, Tesla announced a factory project in Mexico last year. This was a way for the American brand to take advantage of the incentives provided under the Inflation Reduction Act (IRA) by the Biden administration. As the presidential elections approach, the plans of the Austin firm may change. Tesla anticipates a possible victory by Donald Trump.
If elected, the former American president has promised to repeal Joe Biden’s plan. He has also stated that he plans to impose tariffs on electric vehicles manufactured in Mexico and entering the United States. This threat aims to deter Chinese manufacturers from establishing themselves in North America and encourage Americans not to leave the country.
Giga Mexico will not see the light of day anytime soon
This is why Tesla has officially paused its Gigafactory project in Mexico. This is probably why the American company had decided to slow down the development of the factory in recent months. Elon Musk has stated that he believed Donald Trump would win the American elections. Therefore, it would not be logical to continue investing in a factory in Mexico.
Furthermore, Tesla’s CEO has pledged financial support to the Republican candidate, despite his unfavorable stance on electric vehicles. This is quite strange. A monthly sum of $45 million was mentioned, but Elon Musk denied this amount, deeming it “grotesque”, while admitting to making donations without specifying the amounts.