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Tesla signed contracts with local authorities today and has the green light to build the plant, reports the Chinese press. Ceo Elon Musk, according to sources, was present at the signing of the paperwork
Part of the deal is that Tesla opens a place where research, construction of cars and sales combine. The exact location is still unknown, but Tesla will begin construction early next year, when all permits have been completed.
From here two to three years, half a million cars must be built each year at the factory, writes Bloomberg. The US Tesla factory has still not been able to reach this level of production. Earlier this month, CEO Elon Musk was still very pleased that his factory was able to build 5000 Model 3 in a week
Negotiations
Tesla had been negotiating for a few years to open its own factory in China. With a local factory, the brand wants to locate in China, which is a huge potential market. Last year, Tesla realized about 17% of its turnover.
A local factory would also help to avoid high import duties as a result of the trade war between China and the United States. Tesla had to raise model X and S model prices in China by about 20%, due to import tariffs that China imported into US products. This makes cars over 70% more expensive than in the country of origin in America.
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