Tesla reportedly made deal to open a manufacturing facility in Shanghai

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Source:   —  October 22, 2017, at 2:28 PM

Instead, Tesla will own the all factory. That means Tesla will be able to slice some costs of production and ultimately the sale price of Teslas in China, but it'll likely still be responsible for paying China’s twenty-five % import tariff.

Tesla reportedly made deal to open a manufacturing facility in Shanghai

Foreign car-makers traditionally partner with local manufacturers, but that'll reportedly not be the case with Tesla. Instead, Tesla will own the all factory. That means Tesla will be able to slice some costs of production and ultimately the sale price of Teslas in China, but it'll likely still be responsible for paying China’s twenty-five % import tariff.

Rumors of this deal first surfaced in June, when Bloomberg reported Tesla was in talks with Shanghai’s local government to construct its cars there for the first time. Tesla later confirmed it was in talks to construct a factory in Shanghai.

China has the world’s largest vehicle market and has aggressive targets for electric cars. The Chinese government is aiming to sell seven million electric vehicles a year by two thousand twenty-five. In September, China ordered all car-makers operating in China to start making EVs by 2019.

The timing of the official announcement is unclear. I’ve reached out to Tesla and will upgrade this legend if I hear back.

Featured Image: Guus Schoonewille/AFP/Getty Images/Getty Images

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