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The intrusion of Tesla in China becomes a reality.
After announcing in August that the company would invest $ 5 billion in a plant outside Shanghai, the first outside the United States, it has finally secured the ground for the planned gigafactory.
Tesla has signed an agreement with the government for a land of 860,000 square meters, or about 210 acres, according to an announcement made Wednesday. Although the company did not announce the cost of the land, the Shanghai Office of Land Planning and Resources suggested a cost of $ 140 million.
"Securing this site in Shanghai, the first Gigafactory outside of the United States, marks an important milestone for our next advanced and sustainably developed production site," said Robin Ren, Tesla's vice president of worldwide sales. .
The Chinese plant will be located in Lingang, a city located southeast of central Shanghai on the coast. Tesla plans to produce cars from the factory in three years. While it expects to have a production capacity of up to 500,000 by the end of the decade, the plant will initially produce about 250,000 cars and batteries per Tesla per year.
The trade dispute between the United States and China has resulted in increased costs of importing Tesla vehicles into China. But China is Tesla's second largest market after the United States and therefore remains a priority market. He sold 17,000 cars last year and about 50,000 in the United States. Tesla hopes that by producing cars locally, it will be able to circumvent future risks related to customs duties and other import controls.
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