Why Tesla should build the European factory in Vigo?

Let me introduce you into Galicia. Galicia is in the north-west of Spain and up-north of Portugal. Galicia is a historic state that is part of Spain since hundred of years ago. The primary industries of Galicia are fishing, automotive, farming and textile. In the last years is know as Galifornia, you can read here more about it.

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Vigo landscape

But without being boring, let me introduce you why next Tesla factory should be in Vigo-Galicia.

Plenty of cheap lands to set up a factory

From early 1940 Vigo has grown a lot, from 20K people to 300K, it was caused by the industrial sector and led by Citroen car factory. Since then a lot of factories have moved their manufacturing to Vigo Area. At the moment Vigo is the biggest city in population in Galicia and 9th in Spain.

Industrial is a hight priority of the council and the government, so they use to anticipate to the companies and new plans to accommodate more factories are designed continuously. In early 2012, a new 3M square meters area was developed with all services (highway, train, high-speed Internet connection) and it's ready for all the facilities for company's employees (residential areas, public transport, hotels, restaurants, etc.. )

This space was developed in 2005, and the idea was to host the first Mitsubishi Batteries factory in Europe. However the Tsunami in Japan and its consequences resulted in a cancellation of the project, so now that space is ready to be taken by another company.

Good Logistics: port, airport, train, AVE

Automotive factories and heavy industry have a problem that it’s not easy to solve, distribution. Vigo hosts one of the most productive PSA group factory per-square-meter in the world, so the city has learnt a lot from the last fifty years about logistics.

Vigo Port is one of the biggest Europe ports. At the moment council and government are working to extend it a bit more. Last May the council started a project to provide service to the new RO-RO ships with two access ramps. In terms of shipping lines, Vigo counts with more than 50 shipping lines as you can see in the following map.

Concerning Iberia distribution can be done using the train. It has gotten improved in the last years, and all Iberia and France will be connected using the high-speed train. This high-speed train is under development and in the following years a lot of new routes will be opened.

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Ro-Ro terminal, 900K square meters and nine ramps

I spoke about the car’s movement, but logistics is not only about cars. In Galicia(A Coruña) is located Inditex (Zara) headquarters, one of the TOP-25 companies in Europe. Zara has a good compromise with the quality and all batch of clothes are checked in Galicia offices, so container logistic is well structured over Galicia.

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Current Vigo aiport direct connections to the main EU airports

It’s important to mention a few companies that are making some innovations in logistics. Our flagship, Kaleido Logistic, is one of the most innovative logistics enterprises in europe, for example, last March they announced a new startup accelerator with the San Francisco based RockSpace.

Hundreds of well-educated engineers and scientists

So as you see the government quite focuses in the well-equipped space to do business and make companies life easier. But it'll be difficult to be located here if you don’t have a good workforce. So the three universities are the key of our successful histories. Vigo University is quite young (~25 years), the main topics are industrial, electronics and telecommunications. A second branch is under development with BioTechnologies and Sea (is the second main industry in the city).

Spanish university, in general, improved a lot in the last years and keeps growing each year. These well-educated students are providing results now, for example, tech companies like Quobis (World leader in WebRTC solutions), Televes (World leader in TV communications), Marine Instruments (World Leader in buoys for fishing). These companies were founded by local students.

But these students are part of multiple foreign companies that are based here and they provide quite successful products. For example, all the robots that Citroen are using in Vigo factory were made by local workforce; I need to say that the CNC expertise in Vigo is quite valueable.

As each city, we have a startup movement; a few entrepreneur try to build their companies. There is a gap between Galicia and startup ecosystem; VC capital is too small. In the last year, some R&D projects died during cash-flow problems. There were some real projects: like Satelite launch and some Electric car charger; both died caused by cash.

In 2008 Spain had a big bank crisis, so getting foreign investment were too difficult. Meanwhile, all the hundred well-educated students finish their studies, and they can't get work. The result of this equation was that a lot of young people move to work abroad (Me included). Nowadays thousands of Vigo students moved to UK, France, Germany, etc... Linkedin says that more than 1000 engineers from the University of Vigo are in London, more than 300 in France, and more than 500 in Germany. These are only from Vigo University, in Galicia, we had three different Universities. These engineers want to be in their hometown with their families so a new Tesla Factory will be an excellent option to come back to home.

On the other hand, a recent study made by "El Confidencial" reported that 20% of the total Spain immigration is from Galicia. In 2015 Galicia represented around 5.5% of the Spanish population.

Public support

As you read, the government is pretty involved with the private company's success. Being part of Vigo means that a new factory like Tesla can use the Duty Free area, where goods that are meant to be reshipped to another country don’t need to pay duties. This will be useful for Tesla logistics in Europe.

In the other hand, nowadays Galicia government has a financial plan called Industry 4.0. This program is based to help private companies with grants up to 40% of the private investment in the automatization of the process, without limit in the top, so for each $1M that Tesla invest in innovation, Galicia government will return $400K (This have some constraints, but that is the main idea)

Automotive cluster in the region

As I started before, Vigo is pretty involved in the automotive sector. The Citroen Factory building was a boost for the city in 1960, and nowadays we have a high-quality network of automotive providers in the area.

In the early 2000s, which were good years to all of these vendors, some of them started to work with different brands, so nowadays all the auxiliary providers had experience with more vendors, they are not locked with Citroen. This network built a few years ago a new association of companies to set waypoints for the near future about the common benefits.

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Close to this cluster of providers and related to provide solutions to this companies, the government launched innovation centers to provide high-tech solutions to local factories. CTAG is the flagship for innovation in cars; this 500 people company provides crash tech services, sounds experience and all kind of technology related to automobiles. Another technology center that needs to be mention is Aimen, it is focussed on the material resistance, durability, and automatic cutting process.

It’s quite remarkable that this is not new, this is a historical, in 1950 in Ourense we had the luck to have one of the biggest creators of the century: Eduardo Barreiros, this guy built a company that converts petrol truck engines to diesel. Bussines was very successful and in 1959 it was acquired by Chrysler.

Around all car manufacturing and the provider network, Galicia can be proud to host some automotive companies. For example, Urovesa provides car/trucks solutions to military and firefighters, that is used by almost all European armies. About trucks, Ourense based UNVI build thousands of trucks and buses to all Europe. Related to the innovation, we need to mention a small company that produces thousands of electric recreational cars per year.

Good standard of life for the employees

One of the things that I’m too proud to be in Galicia is the level of the living here. Galicia is a place that you can buy a home for €200.000, take a beer for €1.5 and dinner outside for €14. In the other hand, in Spain all the university/scholarship are nearly free, all the National Insurance Services is running by the local state so no one should be worried about nothing less than their work.

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Regarding of living here, you can go to one of the best beaches in the world (Guardian said that), you can go to the top of the mountains and enjoy the Galician lifestyle.

Renewables energy ecosystem

Renewables energy means a lot for a company like Tesla, a lot of us want the world more sustainable, but for that, we need to work together. Galicia is too green, and we want to keep at it is, for that in 2006-2008 the government made a plan to be 100% sustainable using renewable energy. In 2008, Spain fall into the crisis and this plan can’t be executed at all, but we have a good renewables bases.

Nowadays the 30% of the total energy is generated by wind power. On the other hand, the hydropower represents another 40%. In few years I’m sure that Galicia will be 100% green.

Related with the companies working in the renewables energy? Yes! Gamonagoga and Gestamp are one of our biggest companies around the wind power; they can build all aerogenerator pieces. But our experience in ship building industry create third party companies like Industrias Ferri; they make cranes to Ocean Wind Power farms. This shipbuilding expertise help to innovate on tidal energy, at the moment three different companies are working in validation this technology. Ecoforest can’t be forgotten, one of the first enterprises that think in pellet boilers, and nowadays they are pretty big for the country.

Cardama's Shipyard Tidal energy factory

Cardama Shipyard Tidal energy generator prototype launched last year

I need to mention the bad parts, two years ago Spanish government added a penalty to the sun energy, so in the last few years, this generated a lot of controversial issues about that. I hope that this bill will be removed and keep Spain as green as all Spanish people want!

Industrial ecosystem

A lot of things related to cars manufacturing, but what about the industrial ecosystem?. The Industrial Revolution was not too big in Vigo, Sanjurjo Badía led this revolution, he was one of the first businessmen that created the first factories and shipyards in the city, it’s nice to see that in early 1900 he built a submarine.

Speaking about Galicia is too important to mention the shipyards, more than then thousand employees are working directly in the shipyards. Moreover, Galicia is the first door of the Atlantic Ocean means that it has one of the biggest fishing ports in Europe, and it’s the central point of freezing fish in Europe. I can’t found a real statistics of how many people is working related with the sea, but it’ll close to 50.000 people.

Vigo Shipyards

Barreras shipyards. Offshore support vessel

Related with metal/aluminium there are some top companies in the area, as an example, Cortizo is one of the biggest companies associated with aluminum.

And Inditex(Zara) can’t be forgotten in this section; the company has their headquarters in A coruña and all concerned with their new stores, design, tools, etc… Is built/managed mainly from Galicia. So it have been a boost for our industrial ecosystem.

I don’t have more reasons why Tesla must build their next factory in Galicia. In the last years I took more than 200 flights; saw a lot of cities and I were on a few continents, I’m in love with the city where I was born! There are some problems in Galicia, but in the last years, I also learnt that there are problems everywhere, and Galicia is too awesome as it appears.

I invite to Tesla managers to meet Vigo; it’s an awesome city! It has a lot of resources and with a lot of people with the can be done aptitude, with a green mentality and with thousands and thousands of wonderful people around.

So the only thing that I can say, if any Tesla Managers read this post and you want to visit Vigo, I’ll pay your flight, I will love that you come to here, I know that when you arrive, you don’t want to leave!