By Dave Graham and Daina Beth Solomon
MEXICO CITY, Feb 28 (Reuters) – Tesla Inc (TSLA.O) will build a new plant in northern Mexico, the country’s president said on Tuesday, marking a push by the electric vehicle maker to broaden operations outside the U.S. in a deal said by a source to be worth at least $1 billion.
Without providing details, President Andres Manuel Lopez Obrador said “the whole Tesla company” was coming to Mexico, describing the investment as an “automotive plant” that would be “very big” and noting that potential investment in batteries was still pending.
Lopez Obrador’s announcement of the plant in the Monterrey metropolitan area dispelled recent concerns that he could upend the investment by imposing conditions on the company due to problems over a lack of water in the arid border region.
The initial investment will be worth around $1 billion and further phases could bring total spending to $10 billion, according to a Mexican source with knowledge of the matter.
Tesla did not immediately reply to a request for comment.
The company has car factories in California and Texas in the United States, Berlin in Germany and Shanghai in China.
Tesla Chief Executive Elon Musk for months has said the EV maker will announce a new factory, and he is set to discuss expansion plans, next-generation vehicle platforms and other topics at an “Investor Day” event on Wednesday.
