Prominent Tesla Supplier's First U.S. Factory Is Arriving In New Mexico

By Sherah Janay Ndjongo

September 21, 2023

Tesla Supercharger and Tesla Model X car
Photo: Getty Images

Hota Industrial Mfg. Co, a key supplier for Tesla, is set to invest $99 million in establishing its inaugural plant outside of Asia, marking a significant shift toward regional production within supply chains. This momentous decision will see Hota initiate construction in Santa Teresa, New Mexico, near the U.S.-Mexico border, starting early next year, with mass production scheduled for 2025.

Chairman David Shen explained in-depth the rationale behind this strategic move, highlighting how the enduring impact of COVID-19 and the U.S.-China trade tensions have transformed the landscape of globalization, in turn prompting a reevaluation of their approach and inspiring a deeper commitment to the United States.

"With three years of COVID-19 and the U.S.-China trade war changing globalization and creating regional supply chains, we restarted our thinking about going to the United States to make a deeper investment," Shen said.

Proximity to Hota's North American customers, constituting 60% of their sales, played a pivotal role in this decision. Furthermore, the thriving U.S. electric vehicle (EV) industry was a compelling factor.

New Mexico Governor Michelle Lujan Grisham expressed enthusiasm about the development, citing the state's infrastructure and the expertise of Taiwanese companies as valuable assets in facilitating this endeavor, "We have the right infrastructure to meet the growing demands of Taiwanese companies, and their manufacturing expertise is very beneficial because we don't start it from scratch."

The state will contribute $3 million in funding, along with potential tax credits, to support this significant investment.

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