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Tesla To Start Building Gigafactory In China

Musk factory

In a sign that Tesla is preparing to start construction of its first factory in China, Elon Musk said on Monday that he would be visiting China soon for the groundbreaking ceremony.

“Looking forward to visiting soon for the groundbreaking of Gigafactory Shanghai!” Musk wrote on Twitter, replying to a Chinese Tesla owner who had volunteered to deliver a Tesla vehicle to a new owner.

Tesla’s China factory in Shanghai will be its first production facility outside the United States. The EV maker signed the deal for the construction project with the Shanghai authorities in July. The factory is expected to double Tesla’s electric car production, beginning in two years.

The peak annual turnout of the Shanghai factory will be half a million Teslas and the same amount of battery packs, to be achieved two to three years after the launch of production, Tesla said in July after the signing of the deal with Shanghai authorities.  

In October, Tesla said that it had secured a plot of land for the Chinese Gigafactory in its push to start local production in the world’s biggest EV market.  

Tesla is expected to begin partial production at its first factory in China in the second half of 2019, the Shanghai government said after a meeting with local Tesla executives earlier this month.

Tesla has also started a tender process for the construction of the gigafactory in Shanghai, and at least one contractor has begun buying materials for the construction, Reuters reported in early December, citing sources and documents that it has reviewed.

Tesla aims to have a production facility in the world’s top EV market China in order to be able to compete on a level playing field with a growing number of local EV manufacturers. As a U.S.-made vehicle, Tesla’s cars in China have been subject to steep tariffs, and sales have suffered from the U.S.-China trade war.

By Tsvetana Paraskova for Oilprice.com

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  • charles michael johnson on January 02 2019 said:
    And the "mirror" plant setup 10Km down the road will be built at the same time.
    Guess which one stays in business and which one the Chinese government closes down?

    Good luck Elon
    Your going to need it.
  • China Expat on January 02 2019 said:
    Check out the article written in the commentary about the gift Tesla will give to China if it goes through with the plan to build. It is certain that the factory will eventually close or be sold. Telsa's are a great car, but the cost is unsustainable in the U.S., so there is not a chance of Tesla succeeding in China. The only reason Tesla succeeds in the U.S. only because of the USD; without the dollar and subsidies, Tesla will fail. Sorry, I like the car, but it is a fact that Tesla cannot compete against tyranny, human rights, freedom, and the rule of law. America, in general, is finding this out the hard way.
  • Lee James on January 01 2019 said:
    Makes sense to figure out how to do business with China, given today's trade barriers and national companies. EVs are the future, and that's especially true in China.

    But will this be a case of China using Tesla's in-country factory to steal technology and methods, to Tesla's long term disadvantage? Trade with China needs to be clearly win-win.

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