This is reportedly due to ongoing uncertainties in US-China relations.
Text | Cheng Xiaoyi
Edited by Gong Fangyi
According to a Reuters report on May 11, due to uncertainties in US-China relations, Tesla has suspended plans to purchase land in Shanghai for factory expansion. Tesla had once planned to make its Shanghai factory a global export hub. This plan is now temporarily shelved.
Sources say that cars exported from China to the US are still subject to a 25% tariff, which has led Tesla to scale back its construction plans for the Shanghai factory. Previously, it had considered exporting entry-level Model 3s made in China to more markets, including the US.
In March this year, Tesla did not bid for the plot of land opposite its current factory. If acquired, this could have added an additional annual production capacity of 200,000 to 300,000 vehicles. However, informed sources told Reuters that Tesla had no intention of purchasing this plot.
Regarding these reports, Tesla ambiguously stated that the Shanghai factory is 'proceeding as planned.'
The Shanghai factory is Tesla's second factory and also the first wholly foreign-owned factory after China relaxed restrictions on foreign ownership in the automotive industry. Tesla’s Q1 2021 financial report shows that the current capacity of the Shanghai factory (450,000 units) accounts for approximately 42.86% of Tesla’s global capacity.
The factory was designed with an annual production capacity of 500,000 vehicles, taking only 10 months from groundbreaking to trial production, which is about 14 months less than Tesla originally estimated. At the 2019 annual shareholder meeting, Tesla CEO Elon Musk said...