Tesla May Build its Next Factory in South Korea, According to the Country's Presidential Office
【Summary】Tesla Chief Executive Elon Musk said on Wednesday that South Korea was among its top candidates for a new factory. The plant would allow Tesla to tap into the growing electric vehicle market in South Korea, according to the country’s presidential office. Musk made the remarks in a video call with President Yoon Suk-yeol. Tesla also plans to step up cooperation with South Korea on supply chains for electric vehicle production in the country.
With manufacturing facilities in California, China, Germany and Texas, electric automaker Tesla has the ability to build cars on three continents. Although Tesla's Shanghai factory allows the company to supply locally-built vehicles in the world's biggest auto market, Tesla's next factory might be built in South Korea.
Tesla Chief Executive Elon Musk said on Wednesday that South Korea was among its top candidates for a new factory. The plant would allow Tesla to tap into the growing electric vehicle market in South Korea, according to the country's presidential office.
Musk made the remark in a video call with President Yoon Suk-yeol. Tesla also plans to step up cooperation with South Korea on supply chains for electric vehicle production in the country, Yoon's office said.
"We expect to buy components worth more than $10 billion from South Korean firms in 2023 as we significantly expand supply chain cooperation with South Korean companies," Yoon's office quoted Musk as saying.
According to Reuters, President Yoon was already aware of Tesla's plans to build a factory in Asia in the near future, however Yoon asked Musk to build its new factory in South Korea.
Tesla is still in the early stages of planning its next factory. Although Musk said South Korea is one of the top candidates for its next factory, he will make his decision after reviewing investment conditions in other countries, including labor quality, technology level and production infrastructure, Reuters reports.
Musk also was considering Indonesia for its factory, which is already a hub for EV battery production. Earlier this year, Indonesian President Joko Widodo and senior government officials held meetings with Musk, and asked him to consider building a factory in the country.
If Tesla were to build electric vehicles in South Korea, the company would compete with local automaker Hyundai in the EV segment. Hyundai is investing billions to become a global leader in EV sales.
In April, Hyundai unveiled an updated strategic roadmap today which will accelerate its electrification ambitions. The plans include an investment of $79.2 billion through 2030 to boost its annual EV sales to 1.87 million units and take a 7% global EV market share by the end of the decade. Hyundai will become a strong competitor in its home country if Tesla builds its next factory in South Korea.
A factory in South Korea would also put Tesla closer to its key battery suppliers. South Korean battery maker LG Energy Solution currently supplies Tesla and General Motors with batteries. Tesla's other battery suppliers include China's CATL and Japan's Panasonic Corp.
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