Rumor: Tesla Shanghai Factory To Be Announced Soon

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

Originally published on Gas2.

Rumors of a new Tesla factory in Shanghai, China, have been flying around the internet for months. And just as quickly as they popped up, Tesla batted them away, saying they were just speculation, there was nothing official, it was looking at several locations in China, it had made no decision yet, and things of that nature.

Now, according to Bloomberg, an official announcement will come as soon as next week. Unnamed sources say the company has reached an agreement with the city of Shanghai to construct a new factory in the Lingang development zone. Under Chinese law, Tesla will be required to enter into a joint venture with a local Chinese company in order to get permission to build a factory there. The Silicon Valley–based company is anxious to avoid the 25% import duty it currently pays to bring its cars into China.

The reports so far do not reveal who Tesla’s partner might be. Nor do they indicate whether another battery factory will be constructed either at the manufacturing site or at a separate location in the country. Elon Musk said recently that Tesla is considering up to 12 new battery factories in various locations around the world in coming years.

With the Chinese government apparently sticking to its plan requiring all automakers to sell enough “new energy vehicles” to garner credits equal to 8% of total sales starting in 2018, the Chinese market for electric cars, which already dwarfs other electric car markets, could get that much bigger. It’s a business opportunity that Tesla cannot afford to miss. The Chinese new car market is also the largest in the world, with more than 23 million new vehicles sold annually.

Tencent Holdings, China’s biggest internet company, purchased a 5% share in Tesla earlier this year. Having support from such a high-profile Chinese company has to be good news for Tesla in a country where up to 200 companies have expressed interest in building electric cars.

Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.

CleanTechnica Holiday Wish Book

Holiday Wish Book Cover

Click to download.

Our Latest EVObsession Video

I don't like paywalls. You don't like paywalls. Who likes paywalls? Here at CleanTechnica, we implemented a limited paywall for a while, but it always felt wrong — and it was always tough to decide what we should put behind there. In theory, your most exclusive and best content goes behind a paywall. But then fewer people read it!! So, we've decided to completely nix paywalls here at CleanTechnica. But...
Like other media companies, we need reader support! If you support us, please chip in a bit monthly to help our team write, edit, and publish 15 cleantech stories a day!
Thank you!

CleanTechnica uses affiliate links. See our policy here.

Steve Hanley

Steve writes about the interface between technology and sustainability from his home in Florida or anywhere else The Force may lead him. He is proud to be "woke" and doesn't really give a damn why the glass broke. He believes passionately in what Socrates said 3000 years ago: "The secret to change is to focus all of your energy not on fighting the old but on building the new."

Steve Hanley has 5245 posts and counting. See all posts by Steve Hanley