A few hours ago, the North American newspaper Wall Street Journal published a news item indicating that Tesla was in an initial phase of negotiations with the state of Saudi Arabia to build a car factory in its territory. News that could affect plans to do the same in Europe, but that Elon Musk himself has come out to deny.
The news indicates that Saudi Arabia has offered Tesla, in exchange for the installation of a plant in the country, to facilitate the acquisition of metals and minerals necessary for the manufacture of batteries from countries such as the Democratic Republic of the Congo, which has important cobalt and copper reserves, very important for the production of batteries and electric motors.
The American newspaper indicated that, according to the sources consulted, the dialogue between Tesla and Saudi Arabia is in its initial stage and could end at any time without an agreement.
This news would be based on the relations that Musk himself has with the Public Investment Fund (PIF), which at the time planned to purchase all of Tesla’s shares to remove it from the market. The famous offer of $420 per share, brought many problems to Musk himself with fines and sanctions from the North American stock market regulator, the SEC. Musk himself also counts the sovereign fund as one of the investors in his latest acquisition, the social network Twitter, now simply X.
Tesla production expansion
The reality is that Tesla is actively seeking new locations for its future factories. With sales growth above 50% each year, and with economy of scale as a great obsession to reduce costs, the American brand is in the full expansion phase.
Saudi Arabia has been ruled out for now, and with Mexico already confirmed, it remains to be seen where the next one will be. Or the next ones. Tesla wants to produce more than 20 million electric cars per year, which would double the current largest manufacturer, Toyota, which in 2022 sold 10.2 million.
The bets despite the difficulties due to the leaks are Valencia, which can become an important manufacturing hub for cars and batteries, India, and recently Turkey has joined in, with a powerful automobile industry, and where Elon Musk has been visiting and being received by President Erdogan.