Tesla plans $5bn China fac­tory

Irish Independent - Business Week - - Front Page -

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)

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