Tesla steps up plan to pur­sue lo­cal­iza­tion

China Daily - - FRONT PAGE - By HE WEI in Shang­hai [email protected]­nadaily.com.cn Li Fusheng con­trib­uted to this story.

Tesla Inc will start par­tial pro­duc­tion in China in the sec­ond half of next year, the Shang­hai mu­nic­i­pal gov­ern­ment said on Wed­nes­day, as the US elec­tric ve­hi­cle maker ad­vanced its push in the world’s largest auto mar­ket.

Land lev­el­ing has ba­si­cally been com­pleted and site con­struc­tion is on sched­ule to go ahead, the lo­cal au­thor­ity said in a WeChat post de­scrib­ing a visit by Shang­hai Mayor Ying Yong and Vice-Mayor Wu Qing.

After lis­ten­ing to brief­ings from com­pany rep­re­sen­ta­tives and check­ing on pop­u­lar mod­els, the of­fi­cials en­cour­aged the ac­cel­er­a­tion of the plant’s con­struc­tion on the premise of en­sur­ing pro­duc­tion safety and project qual­ity, the post said.

Tesla con­firmed the lat­est de­vel­op­ments with China Daily on Thurs­day, say­ing these ac­corded with an ear­lier state­ment made in its quar­terly re­sults to speed up the man­u­fac­tur­ing time­line in China in or­der to “sig­nif­i­cantly in­crease the af­ford­abil­ity of the

Model 3”.

“We are aim­ing to bring por­tions of Model 3 pro­duc­tion to China dur­ing 2019 and to pro­gres­sively in­crease the level of lo­cal­iza­tion through lo­cal sourc­ing and man­u­fac­tur­ing,” the au­tomaker said in late Oc­to­ber. “Pro­duc­tion in China will be des­ig­nated only for lo­cal cus­tomers.”

In July, Tesla Chief Ex­ec­u­tive Of­fi­cer Elon Musk signed an agree­ment in Shang­hai to open Tesla’s “Gi­gafac­tory 3” in the city, with the ca­pac­ity to pro­duce 500,000 elec­tric ve­hi­cles a year.

It then se­cured a roughly 865,000-square-me­ter site in the sub­ur­ban Lin­gang Area, be­com­ing the largest ever for­eign-in­vested man­u­fac­tur­ing project in the city.

The lat­est de­vel­op­ment in­di­cated the US com­pany has ac­cel­er­ated its plans for the plant.

It pre­vi­ously es­ti­mated it would take around two years be­fore the Shang­hai plant started pro­duc­tion and then an­other two to three years be­fore the fac­tory was fully ramped up to pro­duce around 500,000 ve­hi­cles an­nu­ally for Chi­nese cus­tomers.

To drive lo­cal­iza­tion, Tesla has also launched a WeChat ac­count for hir­ing lo­cal staff. In No­vem­ber, the ac­count re­leased around 30 job va­can­cies for its Shang­hai fac­tory, in­clud­ing qual­ity con­trol and project con­struc­tion-re­lated posts, as well as ad­min­is­tra­tive ti­tles such as se­nior hu­man re­source man­agers.

New-en­ergy cars, which in­clude bat­tery-pow­ered, plug-in hy­brid and fuel-cell ve­hi­cles, are gain­ing pop­u­lar­ity in China. Sales of these mod­els reached 777,000 units last year and could sur­pass the 1-mil­lion mark in 2018, ac­cord­ing to the China As­so­ci­a­tion of Au­to­mo­bile Man­u­fac­tur­ers.

Pro­duc­tion in China will help the elec­tric-car maker to avoid un­fa­vor­able pric­ing in­volved with im­port­ing ve­hi­cles. Last month, it an­nounced it would cut the prices of its new Model S and Model X in China by up to 25 per­cent to ab­sorb “a sig­nif­i­cant part of the tar­iff to help make our cars more af­ford­able for cus­tomers in China”.


A worker in­spects a Tesla Model S at the au­tomaker’s fac­tory in Fre­mont, Cal­i­for­nia.

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