Following Tesla, GM Also Starts Electric Vehicle Production in Mexico

Chevrolet Blazer and Equinox Production Within the Year

[Asia Economy Reporter Yujin Cho] American automaker General Motors (GM) will begin producing electric vehicles at its Mexico plant starting this year. Other automakers such as Ford and Tesla are also relocating their electric vehicle production bases to Mexico. Due to the 'Inflation Reduction Act (IRA),' which provides tax benefits only for North American-made electric vehicles, Mexico is rapidly emerging as a global electric vehicle production hub where tax incentives can be enjoyed.

On the 3rd (local time), major foreign media reported that GM plans to produce all of its electric vehicle models at its Mexico plant starting in 2024. The Mexican government announced that GM plans to start electric vehicle production at a large-scale integrated automobile plant in Ramos Arizpe, located 285 km south of the Texas border, and that GM officials recently met with Raquel Buenrostro, the Minister of Economy, to discuss related matters.

Previously, in April 2021, GM announced plans to invest $1 billion (approximately 1.3 trillion KRW) to establish an electric vehicle production plant in Mexico. The models to be produced at GM’s Mexico plant include the Chevrolet Blazer EV and Equinox EV, with production expected to begin within the year.

[Image source=Reuters Yonhap News]

Earlier, reports emerged that American electric vehicle maker Tesla had selected Monterrey in Nuevo Le?n, northwestern Mexico, as its electric vehicle factory base and is pushing forward with the construction of an electric vehicle plant. Tesla CEO Elon Musk visited Monterrey last year and held discussions with local officials, according to recent reports by Bloomberg News. Tesla currently operates factories in four locations in the U.S., Shanghai in China, and Berlin in Germany. The Monterrey plant will be Tesla’s first production base in Mexico, and it is expected that the Cybertruck, scheduled for release as early as this year, will be produced there.

Among global automakers, Ford was the first to relocate its electric vehicle production plant to Mexico. Since 2020, Ford has been producing the Mustang Mach-E model in Mexico and announced in mid-last year that it would significantly expand electric vehicle production in Mexico.

Stellantis, which owns brands such as Jeep and Peugeot, is considering investing billions of dollars to convert its internal combustion engine vehicle plant in Saltillo, northern Mexico, into an electric vehicle production base. Stellantis CEO Carlos Tavares met with the Mexican president in July and stated that the company is reviewing additional investments in local plants for electric vehicle mass production and requested government-level support.

Foreign media have evaluated that Mexico, which can enjoy tax benefits under the U.S. government’s Inflation Reduction Act, is emerging as a new electric vehicle production hub. These companies are considering either converting existing internal combustion engine vehicle plants into electric vehicle production facilities or establishing new electric vehicle production lines.