Recent reports suggest that Elon Musk, CEO of Tesla, discussed the possibility of building a battery factory in South Africa with the country’s President Cyril Ramaphosa earlier this year.
According to Bloomberg, Musk approached President Ramaphosa to ease regulations for Starlink, SpaceX’s satellite-based internet service, to operate in South Africa. The country currently requires Starlink to be at least 30% Black-owned to operate, potentially necessitating a partnership with local entities.
As part of a potential deal to relax these regulations, Musk and Ramaphosa reportedly discussed the prospect of Tesla establishing a battery factory in South Africa. While the specifics of the proposed factory remain unclear, Tesla currently produces battery cells at Gigafactory Texas for use in its Cybertruck and other products.
Although Tesla has been rumored to explore factory opportunities in South Africa since 2016, no concrete plans have materialized thus far. While the idea of a Megapack factory in South Africa may be on the table, it is uncertain if Tesla will prioritize this location over other markets.
Our Perspective
While the discussions between Musk and Ramaphosa raise questions about potential corporate benefits for Musk’s various ventures, it remains to be seen if a Tesla factory in South Africa will come to fruition. The concept of resource tunneling, leveraging one company for the benefit of another, is not new for Musk, but the implications of such arrangements are worth monitoring.
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