Tesla buys a 210-acre site for a plant in Shanghai

On Wednesday, Tesla announced it has bought a 210-hectare site in Shanghai, China, where it will start building a second battery and auto plant.

According to the Wall Street newspaperRobin Ren, vice president of global sales at Tesla, attended a signing ceremony in Shanghai, saying, "Securing this site in Shanghai, Tesla's first Gigafactory factory outside of the United States, is a milestone for what will be our next developed manufacturing site. "

A Shanghai government website retracing major land purchases in the city detailed a purchase of about $ 140 million in Lingang's eastern district, possibly reflecting the latest acquisition of Tesla.

Last year, reports circulated that Tesla was in talks with the Shanghai government to build a factory in the city's "free trade zone." The district of Lingang is in this zone. Putting his plant there would allow Tesla to own the entire plant while avoiding some import duties that could escalate as a result of ongoing tariff disputes between the Trump administration and China.

China has decided to ease some rules on auto imports this spring, allowing some automakers to own factories in the country without holding 50 percent of the government's traditional capital. In July, Tesla's CEO, Elon Musk, went to Shanghai and signed an agreement for the construction of a plant capable of producing 500,000 vehicles a year. the WSJ note that Tesla has sold about 17,000 vehicles in China in 2017, but without a Chinese factory, the imported Teslas has cost up to 60% more than the price of comparable electric vehicles in China.

In July, Tesla told Ars that after obtaining the appropriate licenses, it would take two years to start producing vehicles and another two or three years before the Shanghai Gigafactory produces 500,000 vehicles a year. . Nevertheless, 210 acres is much smaller than Tesla's current Fremont plant, which relies on 370 acres.

During Tesla's financial appeal in the second quarter of this month of August, Musk said Tesla would not collect money through equity for the construction of the factory and instead finance construction through local Chinese banks. On this call, Musk said with optimism that he believed that Tesla could build this huge plant for about $ 2 billion, less than the cost of Nevada Gigafactory. The plant "would include manufacturing modules and battery packs, body shops, painting and internal assembly," said the CEO in August. Ars has contacted Tesla to find out if all these components will still be included in the current plant plan and we will update it if we receive an answer.