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France in the Lead of the Race to Attract Tesla Investments in Europe

Elon Musk admitted that he will intensify his interest and his commitment to Europe, after the meeting held in France with its president, Emmanuel Macron; the Tesla CEO gave important clues about his future intentions in that country.
Tesla Model Y, Courtesy of Tesla Inc.

A good question would be: why hasn't Tesla set up a new factory or invested more heavily in Europe in recent months? Its most recent construction was the huge Gigafactory located in Berlin, Germany. Since then, its interests have been more directed towards other regions, such as Asia or Latin America (with the future plant in Nuevo Leon, northern Mexico). However, this trend could soon change thanks to an important meeting held just a few days ago.

Plans of the French president, Emmanuel Macron, to lead a drive to manufacture "made in EU" batteries, eliminating subsidies for non-EU electric vehicles, became publicly known not so long ago. Shortly afterwards, on Monday May 15th, Elon Musk himself held a meeting with the President and other top managers of the French executive. After some rounds of meetings and lunch with the French Finance Minister, Bruno Le Maire, Musk stated that he was confident that "Tesla would make significant investments in France in the future", although without giving a schedule or specific details in this regard.

During a press conference, Musk also assured that "there are no announcements today, but I am very impressed with President Macron and the French government and how welcoming they are".

According to what was published by the French Executive, the meeting held with the Tesla CEO covered various topics of common interest. Among them, Europe's response to the well-known US Inflation Reduction Act (IRA) and the progress France has made in attracting investment and improving the outlook on electric cars and sustainable energy. At the same time, Le Maire presented Elon Musk with the new tax credits for investments in green technology that France published last week; something that has particularly caught the attention of the Austin-based CEO.

Gigafactory Berlin, courtesy of Tesla Inc.

Elon Musk's visit took place on the occasion of the so-called “Choose France” annual business summit, chaired by President Macron himself, with the always striking and historic Palace of Versailles as the setting. The French president's plan with this event has been clear for the last five years: to invite the main executives and managers of large companies in order to attract important investments within the French borders.

As a matter of fact, Tesla has already been involved in many conversations with France so far. The company carried intensive and detailed studies a few years ago to build its - for now - only European Gigafactory on European soil. Finally, for various reasons, the final choice was Berlin, Germany, as it is widely known. However, France is in fact still trying to get some sort of investment from the American EV firm.

During the press conference Macron was asked if the French government was trying, with this invitation, to get Musk to agree to build another EV Gigafactory within its borders. To this, Le Maire stated that he would prefer to keep all the content of the negotiations secret so that rival countries could not have more information than necessary. “It is a battle in which no one does anyone a favor”, he said.

Tesla pointed out a few weeks ago that the company wanted to focus the production of its batteries in the United States, thanks in part to the incentives granted by the state government in that regard (the IRA Law), something with which France is already seeking to compete, somehow. The first clues about Tesla's possible first project in France should arrive in the coming months.

Tesla Model Y, Courtesy of Tesla Inc.

The meeting between Elon Musk and the French president, Emmanuel Macron, seems to have sparked new possibilities for Tesla's future investments in Europe, particularly in France. The growing interest in expanding battery production and promoting green technology, coupled with generous tax credits and incentives, could potentially sway Tesla to consider establishing a new Gigafactory or other significant EV infrastructure within the French borders.

Moreover, the warm reception from the French government and the collaborative approach in discussing pressing issues reflects their eagerness to foster a strong partnership with Elon Musk and Tesla. As the European market becomes more competitive, keeping an eye on the developments in the coming months will be crucial to determine the ultimate winner of this EV race.

All images courtesy of Tesla Inc.

Nico Caballero is the VP of Finance of Cogency Power, specializing in solar energy. He also holds a Diploma in Electric Cars from Delft University of Technology in the Netherlands, and enjoys doing research about Tesla and EV batteries. He can be reached at @NicoTorqueNews on Twitter. Nico covers Tesla and electric vehicle latest happenings at Torque News.

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