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Tesla receive green light for Chinese factory

17/10/2019
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Tesla have been granted official government approval to start production of their Model 3 cars at a new $2 billion factory in Shanghai.

Tesla's $2 billion gigafactory in Shanghai
(Image via Tesla)

Gigafactory 3 will become the first electric vehicle factory wholly-owned by a foreign automaker in China, and Tesla’s second electric vehicle production factory. It’s intended to build at least 1,000 Model 3s each week.

Tesla broke ground at the site of the factory in January, but would not have been able to begin production until the government gave its approval.

Under China’s government rules, cars may only be produced by approved automotive manufacturers. A revised list of these manufacturers was published on Thursday, with Tesla Inc included.

“This means “the green light is fully given to Tesla for production in China,” explained Yale Zhang, head of the Shanghai-based consultancy Automotive Foresight.

“Tesla can start production any time.”

China represents the world’s biggest car market, and the permission granted to Tesla is being seen as Beijing looking to open up that market to more foreign investment. Though US firms are subject to import tariffs under the Trump administration, building the cars within China will allow Tesla to avoid these. 

Authorities in Shanghai have reportedly offered Tesla help to speed up construction of the plant, with China excluding Tesla vehicles from a standard 10% tax on cars.

According to CEO Elon Musk, the new factory will build “affordable versions” of the Model 3 and Model Y for the Greater China region. Back in January, when construction of the factory began, he tweeted:

“Aiming to finish initial construction this summer, start Model 3 production end of year [and] reach high volume production next year.”

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Tesla receive green light for Chinese factory - Time to read 2 min
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