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Tesla May Have The Location of Its Next Factory

Elon Musk has promised he will announce the locations of the next Tesla factories by the end of 2022.
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Tesla  (TSLA) - Get Tesla Inc. Report is the world leader in the lucrative electric vehicle market. 

And the Austin, Texas-based company is keen to keep its crown, which is coveted by the likes of Volkswagen  (VWAGY) - Get Volkswagen AG ADR Report, Ford  (F) - Get Ford Motor Company Report, General Motors  (GM) - Get General Motors Company Report, Mercedes-Benz  (DDAIF) , BMW  (BMW.DE)  and the rest of the automotive industry. 

If its rivals are doubling down on projects, in particular by adding new models to their vehicle portfolios, Tesla is focusing on other points because the roadmap for the next Tesla models is indeed known: this list includes the very futuristic Cybertruck, a new Roadster and the Tesla Semi whose production should start in 2023. Tesla is also working on its robotaxi fleet which will be based on a new and futuristic vehicle from 2024. 

Elon Musk's group wants to focus on increasing its volumes of production and delivery. Tesla also wants to secure its raw materials supplies at a time when supply chains are being disrupted.

The vehicle manufacturer, for example, recently opened its first European factory near Berlin to serve the Old Continent. Tesla has also been producing vehicles in Austin since April, its second U.S. factory after Fremont in California. In total, the group has four vehicle production sites – Austin, Fremont, Berlin and Shanghai – which should allow it in the short term to be able to produce at least 1.5 million vehicles in 2022. 

Talks with Indonesia

But the company, which wants to be able to produce some 20 million vehicles annually in the coming years, plans to build new factories. Musk promised on the first-quarter earnings conference call that he will announce the location of the next manufacturing sites by the end of 2022. 

One of those sites could be in Indonesia. Indeed, the Indonesian president Joko Widodo has just paid a visit to Musk in Texas.

The two men visited the production site of SpaceX, Musk's company that manufactures the rockets in Boca Chica on May 14. During this visit, the Indonesian president invited the serial entrepreneur to visit the Southeast Asian country which is rich in natural resources.

"Hopefully in November, thank you for the invitation," Musk said according to a statement from Widodo's office.

In a tweet, Widodo says he discussed technology and innovation with the richest man in the world.

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"Arriving at the Stargate Space X Building, Boca Chica, United States, this afternoon, I immediately met the host, @ElonMusk We talk about technology and innovation," the Indonesian president posted on May 14, according to a translation of his message by TheStreet.

"It was an honor to meet at Starbase and discuss exciting future projects!" Musk commented on May 16 without elaborating further on the plans.

Announcements in November?

It is interesting to note that this is the second visit of an Indonesian delegation to Austin in less than a month. This suggests that discussions between Musk and Indonesia are well advanced.

Tesla and Indonesia have reportedly been in talks since at least 2020 over whether the EV maker could invest in nickel in the country and to build a full battery factory.

Indonesia is indeed a major producer of nickel, and the government is working to expand mining and refining. The country has imposed a ban on the export of nickel in an attempt to force companies to settle there in order to open sites to create jobs. Indonesia signed a $9.8 billion agreement with the South Korean group LG to produce lithium batteries, intended for electric vehicles. Lithium batteries require nickel.

But these ambitions do ecological damage, militants and activists say. 

For example, fishermen in the Obi Islands, Indonesia, blame nickel mining and smelting industries for the scarcity of fish in their traditional fishing grounds.

According to researchers, the pollution has turned coastal waters into a "mud puddle" due to high levels of heavy-metal contamination.

An investment deal in Indonesian nickel could allow Tesla to further secure its supply of this important metal. Nickel is used to make stainless steel and the batteries, which are the heart of an EV because they determine a vehicle's range and play a key role in its performance and security.

Besides Tesla, Indonesia could also become the location of a new SpaceX site. According to the BBC, the country has offered up one of its islands in West Papua as a potential launch site for Space X project - which aims to put humans on the moon.

If there were agreements between Indonesia and Tesla and SpaceX, they could be signed in November because the country will hold a B20 summit with business leaders in mid-November ahead of the G20.