"México-Tesla Agreement: Mutually Beneficial or One-Sided Arrangement?", 18 March 2023

...On March 1, 2023, México’s President Andres Lopéz Obrador confirmed an agreement with Tesla that allows the electric vehicle company to build the “biggest electric vehicle plant in the world.” The plant, or maquiladora, will be located in the border state of Nuevo León...The agreement is governed by the United States-México-Canada Agreement (USMCA), previously known as the North American Free Trade Agreement (NAFTA)...

...However, several issues have come to the forefront as a result of the manufacturing agreement. For example, environmental concerns, the negative reputation of maquiladoras related to rampant violations of workers’ rights, and Musk’s expressed support for the failed “lithium coup” in Bolivia raise serious questions...

Tesla joins a long list of automotive companies that already have plants in México...

...Advocates of workers’ rights are concerned that Tesla’s engagement in open anti-union tactics will negatively contribute to the long history of labor violations at maquiladoras. Given these labor concerns, México’s President successfully advocated for the inclusion of labor provisions within the USMCA that seek to address the past abuses...

Just weeks before the confirmation of the agreement between México and Tesla, the Mexican President expressed concerns related to water scarcity in the State of Nuevo León. President Obrador stated, “if there is no water, the permits will not be issued” ...Throughout 2022, Nuevo León faced an “acute water shortage” which resulted in the state rationing and restricting water usage by “water-intensive industries"...Tesla has responded to the water concerns by assuring Mexican officials that the company will rely on minimal water, recycled water, and the capturing of rain water.

Despite Tesla’s assurances, U.S. manufacturing plants have been found to misuse México’s water resources, pollute streams, leaving Mexican citizens with limited access to clean water...

...The lithium mining has caused severe environmental issues that violate the provisions under the Sonora River Trust.

Alfonso Durazo, Governor of Sonora, “mentioned that a work team is preparing to resolve the commitments not met by Sonora River Trust to the population of Cananea and the surrounding towns that have suffered damage to their health, development and economy...