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Tesla to begin production in China in 2019

Tesla-to -begin -GBO

The company is on pace to start production at its factory in second half of 2019, stated the Shanghai government

Land leveling is mostly complete and the factory is about to begin construction, with the aim expected for it to be operational in the second half of 2019, according to an official WeChat post from the government. The article described a visit by Shanghai Mayor Ying Yong and Vice Mayor Wu Qing.

Tesla did not immediately respond to an emailed request for comment. In mid-October, Tesla officially acquired a 864,885 sqm plot in Shanghai’s Lingang area for the electric car maker’s first factory outside the USA.

Elon Musk’s famed company has also launched an official WeChat account for hiring locals.

Producing in China, the world’s largest market for electric vehicles, would allow Tesla to reduce its costs significantly. The company has stated that it is operating at a 55%-60% cost disadvantage with a domestic peer due to ocean transport costs and tariffs.

Ying Yong, the mayor of the city, visited the project site in the Lingang area and encouraged Tesla to accelerate construction, according to a statement on Shanghai’s official WeChat account. The plant, which is dubbed Gigafactory 3, will be the biggest ever foreign-invested manufacturing project in Shanghai. A Tesla representative was not available for immediate comment.

The Palo Alto, California-based company has secured more than 200 acres of land for the China factory, which is expected to cost several billion dollars to build. Tesla’s first overseas plant will help the electric-car maker avoid some of the risks involved with importing vehicles, such as higher tariffs caused by the trade tensions between China and the US.

The tariffs have impacted Tesla’s sales in China, stated the company when it reported its third-quarter earnings in October.

Chief Executive Officer Elon Musk stated at the time that Tesla was striving to start production of its Model 3 vehicle in China next year. The company has also started to advertise for employees for the new facility.

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