Tesla Inc (TSLA) Snags Plot of Land for China Factory

Lloyd Doyle
October 19, 2018

Tesla did not reveal the selling price for the plot.

Washington imposed penalty tariffs on Chinese goods and Beijing retaliated by raising duties on imports of American products including electric cars.

Tesla on Wednesday secured a 860,000 square metre piece of land in Shanghai, in another step towards building its first plant outside the United States.

The website of Shanghai Land Market, however, shows the original starting price of the land for sale was 973 million yuan (about 141 million US dollars). However, the vehicle shipped from Tesla's California factory are subjected to a high import tariff, which adds almost 30 percent to the sticker price for Tesla's Chinese customers.

Tesla successfully acquired an 864,885-square meter plot in Shanghai's Lingang area for the electric auto maker's new factory, according to an announcement from Lingang Wednesday afternoon.

Watch Tesla trade in real time here. Beijing responded by slapping an additional 25 percent tariff on cars imported from the USA, raising the total tariff to 40 percent.

Above: Tesla and Shanghai officials at a signing ceremony.

Tesla wants to expand its business operations in China, according to a Wall Street Journal report published today.

With this, the company will also receive access to cash incentives that are only available to locally produced electric vehicles, a category Tesla will fall in once its Gigafactory 3 is up and running. Its chief executive, Elon Musk, said in August Tesla expected to invest US$2 billion initially to produce 250,000 electric cars at the Shanghai-based plant, which is likely to be operational in two years.

NEV sales were up 54.8 percent in September and climbed 81.1 percent in the first nine months of this year to 721,000 vehicles, the country's top automobile industry association said last week.

The company's planned Gigafactory 3 has been created to have a capacity of 500,000 vehicles.

Other reports by Iphone Fresh

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