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Shanghai Will Let Tesla Build 500K Cars a Year | News & Opinion

We first heard about Tesla attempting to build a factory in China a year ago, but it now looks as though the deal has finally been done and Tesla’s capacity is set to soar once this facility is operational.


Tesla Model X

At the beginning of July, Tesla announced that electric car production had reached 7,000 a week, taking the yearly total up to 364,000. That’s impressive for such a new car company, but Tesla just signed a deal in China allowing production to increase by another 500,000 a year.

Tesla has had an eye on China for a while now, with talks to build a factory in Shanghai first heard about back in June 2017. Musk’s company got around the encouraged/required partnership with a local Chinese company by opting to build in Shanghai’s free trade zone. The deal Tesla was trying to strike with local government needed to both allow the factory to be built and operate, but also keep tariffs to a minimum.

As Reuters reports, the negotiations were protracted, but a year on from when the talks began the relevant documents have been signed. The Shanghai municipal government, Shanghai Lingang Area Development Administration, and Lingang Group have all agreed to allow the Tesla factory to operate and produce up to 500,000 new electric vehicles every year.

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It’s a positive outcome for everyone involved. Tesla can start to produce and provide its vehicles for the Chinese market while Shanghai will benefit from thousands of new jobs, local companies receiving new orders from Tesla, and a general boost to the local economy any major business investment brings.

No target dates have been released publicly as to when Tesla will have the new factory operational. I’m sure Musk is just thinking “as soon as possible!”


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