Tue, Jan 08, 2019 - Page 10 News List

Tesla constructs Shanghai plant amid trade tensions


Tesla Inc chief executive officer Elon Musk said the maker of electric vehicles would break ground yesterday on a Shanghai factory that would allow it to sell direct to Chinese consumers and avoid tariffs from the China-US trade dispute.

Tesla in July unveiled plans for what is Musk’s biggest overseas move yet, saying that the factory’s eventual annual production of 500,000 vehicles would dramatically increase its output and allow more direct access to the world’s biggest electric-vehicle market.

“Looking forward to breaking ground on the @Tesla Shanghai Gigafactory today!” Musk tweeted.

“Aiming to finish initial construction this summer, start Model 3 production end of year & reach high-volume production next year,” he added.

Chinese media reports said Musk would be in Shanghai to break ground on the plant, which Bloomberg News has reported could cost US$5 billion.

A Tesla spokeswoman said she was not authorized to confirm Musk’s attendance, or provide other details until after the ceremony.

Musk said the Shanghai plant would supply the “Greater China region” with “affordable versions” of the Tesla Model 3 — the automaker’s first mid-price, mass-market vehicle — and its planned Model Y.

The Model S, Model X and “higher cost versions” of the Model 3 and Model Y would continue to be made in the US for the global market, including China, he added.

Despite its relative affordability compared with other Tesla models, the price of a US-made Model 3 starts at about US$50,000, but Musk has said that he aims to get the price down to US$35,000. He provided no price figures for China-made vehicles.

The Shanghai factory would be Tesla’s first production line outside the US.

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