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Tesla plans massive new factory in China

12/07/2018
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Following extensive negotiations aimed at opening up the Chinese market, Tesla has finally reached an agreement with the Chinese government to build the first wholly foreign owned car assembly plant in the country.
Tesla's Freemont manufacturing facility in California.
(Tesla’s Freemont manufacturing facility in California. Image via Tesla).

With pressure mounting on Tesla Chief Elon Musk to increase production of the company’s much feted Model 3, construction of the plant will begin as soon as approvals and permits are secured, with the first vehicles expected to roll off the production line within two years.

Tesla’s current Fremont, California assembly plant is already behind anticipated production schedules. In 2018, the plant was scheduled to produce 500,000 vehicles. Instead, only around 88,000 vehicles have been built at the plant so far, this year.

With China being the world’s biggest market for electric vehicles, and President Trump scaling up his trade war, Tesla has been rapidly exploring ways in which to produce vehicles directly in China. From this new factory, Tesla will supply China ‘and potentially other parts of Asia with a couple hundred thousand vehicles per year’, meaning that the planned factory will be of a substantial scale.

Tesla are not alone in pursuing the Chinese electric vehicle market. Both BMW AG and Daimler AG are currently engaged in efforts to take advantage of the massive and fast-growing market. Last year saw over 777,000 electric vehicles sold in China, with the figure possibly surpassing 1 million this year according to the China Association of Automobile Manufacturers. The Chinese government’s target for electric vehicles is an enormous 7 million a year by 2025.
Tesla's new manufacturing facility in China would act as a hub supplying 'hundreds of thousands' vehicles to the wider Asia region.
(Tesla’s Freemont manufacturing facility in California. Image via Tesla).

With plans progressing well in China, Elon Musk has said that he will reveal plans towards the end of this year to build a plant in Europe as well…

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