Tesla manufacturing: production in Mexico

Tesla currently has manufacturing facilities in northern California, in Buffalo, New York, Gigafactory New York; in Austin, Texas, Gigafactory Texas; and near Reno, Nevada, Gigafactory Nevada, in the United States.

Among other things, at these facilities, the company manufactures and assembles vehicles, certain vehicle parts and components, such as its battery packs and battery cells, energy storage components and solar products and components.

Internationally, Tesla also has manufacturing facilities in China (Gigafactory Shanghai) and Germany (Gigafactory Berlin-Brandenburg).

Both facilities enable the company to increase the affordability of its vehicles for customers in local markets by reducing transportation and manufacturing costs and eliminating the impact of unfavorable tariffs.

Overall, Tesla continues to expand production capacity at its existing facilities.

Tesla

The company also intends to further increase cost competitiveness in its significant markets by strategically adding local manufacturing.

In particular, Tesla is analyzing projects to produce in Mexico, a country that has among its advantages geographic location, a network of free trade agreements, skilled labor, supply chain and a population that averages 29 years of age.

Supply chain

The company’s products use thousands of parts sourced from hundreds of suppliers around the world.

Tesla has developed close relationships with suppliers of key parts, such as battery cells, electronic components and complex vehicle assemblies.

Some components purchased from these suppliers are shared or similar across many product lines, allowing the company to take advantage of price efficiencies resulting from economies of scale.

As is the case in some automotive companies, some of the components and systems we purchase are sourced from single suppliers.

Where multiple sources exist for certain key components, the company works to qualify multiple suppliers for them when it makes sense to do so, in order to minimize potential production risks due to disruptions in their supply.

It also mitigates risk by maintaining safety stocks for key parts and assemblies and die banks for components with long lead times.

Its products use a variety of raw materials, including aluminum, steel, cobalt, lithium, nickel and copper.