Tesla plans $5bn China factory
TESLA plans to invest $5bn (€4.3bn) building a factory in China as the trade war with the US makes establishing production in the world’s fastest-growing car market more imperative for the electric-car pioneer, a person familiar with the matter said.
The company is considering raising funds in China to finance at least a portion of the investment for the plant, said the person, who asked not to be identified as the plans are private.
Tesla agreed last month to build the factory near Shanghai, and it expects to start producing its new Model 3 vehicle there by 2020, the person said.
Securing a factory in China became more crucial for Tesla after the nation imposed a 25pc additional tariff on imports of US-made cars in retaliation for President Donald Trump’s levies on $34bn of Chinese goods.
China is the world’s biggest market for electric cars and the second-largest market for Tesla, trailing only the US.
The California-based company didn’t respond to an email seeking confirmation of the plans, and a spokeswoman for Tesla in China didn’t return phone calls.
China’s ambition to boost annual sales of new-energy vehicles tenfold by 2025 has encouraged hundreds of carmakers to produce electric vehicles in the country. Backed by investments from local governments, tech entrepreneurs and venture-capital firms, Chinese EV startups are trying to capture the market before Tesla increases its presence. (Bloomberg)