Tesla plans new Shanghai factory to make Megapack batteries

Tesla is new battery It is investing more in China amid rising tensions between Beijing and Washington.

Tesla will manufacture megapack large-scale energy storage units at the new facility. Electric carI am in Shanghai. Tesla made the announcement at a signing ceremony for the project in Shanghai. Shanghai government officials, including Tesla Senior Vice President of Automotive Tom Zhu and Deputy Mayor Wu Qing, were in attendance, and Tesla Vice President Tao Lin signed the deal.

Tesla CEO Elon Musk was also reportedly in China at the time.

Leveraging China’s world-leading battery supply chain, Tesla will increase production of its Megapack lithium-ion battery units to reduce costs, helping the world to grow as the world uses more renewable energy. meet the growing demand for energy storage.

Construction is expected to begin in the third quarter of this year and the plant is expected to begin production in the second quarter of 2024.

Tesla already operates a megafactory in Lathrop, Calif., capable of producing 10,000 megapacks per year.

Tesla’s investment in China deepened shortly after France’s Airbus SE announced plans to double the production capacity of its best-selling jet. The European planemaker will add his second final assembly line for his A320 narrowbody at its Tianjin factory under a contract signed by his CEO Guillaume Faury in Beijing on Thursday.

The new manufacturing project will give a boost to Chinese industry, as other companies such as Apple Inc. are slamming Russian President Vladimir Putin from a Chinese spy balloon allegedly shot down over the United States. It is rethinking domestic production amid heightened tensions with the United States over everything from its partnership with .

Megapack is intended as a large battery to help stabilize the energy grid, with each unit capable of storing enough energy to power an average of 3,600 homes for one hour, the company said. The new plant will initially produce 10,000 megapacks annually. This equates to approximately 40 GWh of energy storage and the products will be sold worldwide.

Home to fast-growing global electric vehicle maker BYD Co., China is a very important market for Tesla. An existing car factory outside Shanghai, wholly owned by a US company, produced about 711,000 EVs last year. This represents 52% of global output, despite production being disrupted by China’s now abandoned COVID-zero policy.

Officials roll out the red carpet to help Tesla set up its first factory outside the U.S. in early 2019, with Shanghai government officials to resume production in a timely manner after pandemic-related disruptions. supported the company for

However, Mr. Musk’s activities in China have not been completely smooth sailing. The expansion of his EV factory in Shanghai was delayed due to data concerns about his connection with Tesla and Musk’s Internet-from-space initiative, Starlink, a person familiar with the matter said earlier this year. rice field. Price cut again.

Tesla cars were also banned from military and residential installations in China in early 2021 over concerns about sensitive data being collected by cameras built into the cars.

Musk said in its January earnings call that China is the most competitive auto market. He has made similar comments before, including when he said in an online forum in September 2021 that he has “great respect for many Chinese automakers.”