Elon Musk's 'Teslaquila' drink faces clash with Mexican tequila industry

By Sharay Angulo

MEXICO CITY (Reuters) - Tesla Inc co-founder Elon Musk and Mexico's tequila producers could be headed for a collision after the agave-based drink's industry group opposed the flamboyant billionaire's efforts to trademark an alcoholic drink dubbed "Teslaquila."

One of the world's richest people and chief executive of Tesla, Musk is known for ambitious and cutting-edge projects ranging from auto electrification and rocket-building to high-speed transit tunnels.

Now it seems that Musk could be setting his sights on disrupting the multibillion-dollar tequila industry.

On Oct. 12, he tweeted "Teslaquila coming soon" and an accompanying "visual approximation" of a red and white label with the Tesla logo and a caption that stated "100 percent Puro de Agave."

Not so fast, said Mexico's Tequila Regulatory Council (CRT). It argued that the "name 'Teslaquila' evokes the word Tequila ... (and) Tequila is a protected word."

The CRT keeps tabs on producers to assure they adhere to strict denomination of origin rules, which dictate the spirit must be made in the Mexican states of Guanajuato, Jalisco, Michoacan, Nayarit or Tamaulipas, among other requirements.

According to the U.S. Patent and Trademark Office website, Tesla has filed an application to trademark "Teslaquila" as a "distilled agave liquor" and "distilled blue agave liquor." Similar applications have been filed in Mexico, the European Union and Jamaica.

"If it wants to make Teslaquila viable as a tequila it would have to associate itself with an authorized tequila producer, comply with certain standards and request authorization from Mexico's Industrial Property Institute," said the CRT in a statement.

"Otherwise it would be making unauthorized use of the denomination of origin for tequila," it said, adding that the proposed name "Teslaquila" could make consumers confuse the drink with tequila.

Tesla did not respond to several requests for comment.

Other high-profile celebrities have cashed in on tequila's new-found international appeal, as the sprit moves into the ranks of top-shelf liquors and sheds its image as a fiery booze drunk by desperadoes and frat boys.

Last year, Diageo Plc bought actor George Clooney's high-end tequila brand Casamigos for up to $1 billion.

Other recent deals in the industry include Bacardi Ltd's January deal to buy fine tequila maker Patron Spirits International for $5.1 billion.

After years of speculation, Mexico's Beckmann family launched an initial public offering of Jose Cuervo in 2017, raising more than $900 million.

(Reporting by Sharay Angulo; writing by Anthony Esposito; editing by Frank Jack Daniel and Rosalba O'Brien)