Tesla Supplier Says Giga Mexico Start of Production Delayed as far as 2027

Tesla is currently in the process of massively increasing the company’s production capacity. Just in the last year and a half, Tesla inaugurated two brand-new factories on two continents. Tesla is also in the process of ramping up a new manufacturing line at Giga Texas to start Cybertruck volume production.

If all this wasn’t enough, at the start of the year, Tesla also announced two brand-new factories. The first one is a massive expansion to Giga Nevada that should allow the plant to produce 50,000 Tesla Semis and 100 GWh 4680 cells a year.

The second and perhaps Tesla’s most ambitious factory plan to date is a new plant to be built in Nuevo Leon, Mexico. This plant, officially called Giga Mexico, will sit on a massive 2400 acres of land and is expected to have an annual production capacity of 2 million vehicles.

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In addition to its sheer size and production capacity, what makes Giga Mexico even more impressive is the fact it is expected to be the first Tesla plant to produce the company’s next-generation vehicles. 

Tesla has yet to unveil the exact vehicles that will be built on the company’s upcoming Gen-3 platform. However, from Tesla’s Investor Day presentation, we know that the Gen-3 platform is a fundamental architectural rethink of not only how Tesla vehicles are built but also how all vehicles should be designed and put together.

The Gen-3 platform cuts the cost of Tesla’s next-generation powertrain to below $1,000, cuts the factory footprint needed to assemble vehicles by more than 50%, and finally the Gen-3 platform will allow the vehicle manufacturing process to be significantly automatable which means, it’ll allow Tesla to produce vehicle using fewer people.

Given the new vehicles and all the technological advancements coming with Tesla Giga Mexico, the plant's opening is a hotly anticipated item in the Tesla community. Initially, when Tesla announced Giga Mexico back in March, the EV maker said construction should begin in the next few months and that production should start by the end of 2024 or early 2025.

The ambitious scale of the Giga Mexico project meant Tesla’s audacious plans to start production so soon was a reason to celebrate the EV maker’s construction and manufacturing prowess.  

However, a plan is just a plan, and when Tesla tried to put to ground these expedited goals, the EV maker seems to have run into challenges. And these difficulties appear to have significantly delayed Giga Mexico.

Tesla, together with its Giga Mexico plans, had also called on its suppliers to locate near the factory. This move is intended to cut down on the amount of distance vehicle components have to travel to get to the factory.

And now according to a report by the Mexican publication Reforma which spoke to a Chinese Tesla supplier that chose to remain anonymous, Tesla plans to significantly delay (up to late 2026 or early 2027) the start of production at Giga Mexico. 

The Chinese supplier told Reforma, "Two or three months ago there was a lot of rush, lots of pressure to look for a location. But one month later, they told us to wait.”

If true, this means Tesla has postponed Giga Mexico plans by a full 2 years from what the company was working towards just a few months ago. Reforma did not elaborate on the reasons behind this massive delay, however, the available information so far suggests that Tesla has run into bureaucratic red tape in the permitting process for Giga Mexico.

And if you think this is bad news, Danish engineering consultancy Ramboll, which is familiar with large construction projects in Mexico, taking into account the permitting process suggests let alone vehicle production, Giga Mexico will not even begin construction until 2027.

This will push the start of volume production to 2028 or 2029 at the earliest or, in other words, 4 to 5 years behind schedule. This would be a major blow both for Tesla and Mexico however, until now we’ve yet to hear from both parties regarding the change of plans.

We’ll be sure to keep you posted if we learn more about the issue. Until then, make sure to visit our site torquenews.com/Tesla regularly for the latest updates.

So what do you think? Are you disappointed to learn that Tesla is significantly delaying Giga Mexico plans? Also, what do you think this means for Tesla’s next-generation vehicle? Let me know your thoughts in the comments below.

Image: Courtesy of Tesla, Inc.

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Tinsae Aregay has been following Tesla and The evolution of the EV space on a daily basis for several years. He covers everything about Tesla from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at @TinsaeAregay for daily Tesla news.