Tesla To Construct Subsequent-Technology Automobile In Austin Earlier than Mexico!

Despite the fact that many Tesla bulls assume a “Mannequin 2” (aka “Mannequin C” or $25,000 Tesla) could also be pointless if Tesla will get FSD (Full Self Driving) working within the subsequent 12 months, it appears from this newest excerpt from Walter Isaacson’s ebook about Elon that the realists at Tesla have satisfied Elon to permit the design and manufacturing of a next-generation compact automobile. If not for the US, at the least for markets that received’t approve full self driving.

My private opinion is that it’ll take a number of years to unravel all of the FSD points, regardless of pleasure surrounding Elon’s current demo of V12 FSD. The subsequent-generation compact shall be designed to make use of the identical platform because the robotaxi, so it could possibly share the manufacturing improvements described at Tesla Investor’s Day in March of this 12 months. For extra, we wrote about it right here, right here, and right here.

I advised in a put up yesterday in reply to information the Mexico gigafactory was delayed, probably for years, that Tesla ought to simply develop the Austin gigafactory for now. It appears like Elon got here to the identical conclusion.

Causes To Construct In Austin

  1. Tesla already has numerous engineering expertise at Austin. And it will be troublesome for Tesla to persuade a lot of these individuals to maneuver to Mexico (as said within the ebook excerpt).
  2. Tesla didn’t appear to have any issues getting permits in Austin, and development appeared to be very fast.
  3. Tesla already has important infrastructure in Austin and may probably take a look at manufacturing in an current constructing.
  4. The corporate can construct a sprung construction (or “tent” because it was referred to as by Tesla bears) in 19 days in response to this case examine.

Causes To Construct In Mexico

Whereas I’m a fan of designing and constructing the Mannequin 2 in Austin, I’ve lengthy (3 and a half years) advocated for plant in Mexico, too.

  1. Mexico has extra free commerce agreements than some other nation! That is key to exporting to lots of the international locations in South America and Southeast Asia. It even has an settlement with the European Union!
  2. I’m certain Tesla can pay higher, however current manufacturing staff are reported to make about $5 an hour.
  3. Mexico has extra engineering college students than the US. Tesla would probably get the cream of the crop from that pool.


I believe one of the best of each worlds is to design the next-generation product in Austin, however then construct each within the US to fulfill the big US market whereas additionally constructing a big quantity in Mexico (and different places too) to serve a bigger world market.

If you wish to make the most of my Tesla referral hyperlink to get $500 off a brand new Tesla plus 3 months free trial of Full Self Driving, right here’s the code: https://ts.la/paul92237 — but when one other proprietor helped you, please use their hyperlink as a substitute of mine, since I’ve sufficient referral credit.  If you wish to study extra about Tesla’s referral program, right here is the hyperlink with the most recent particulars. 

Disclosure: I’m a shareholder in Tesla [TSLA], BYD [BYDDY], Nio [NIO], XPeng [XPEV], Hertz [HTZ], and a number of other ARK ETFs. However I provide no funding recommendation of any kind right here.

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