Tesla secures land in Shanghai for first factory outside US | AP business

Marco Green
October 19, 2018

US imports targeted by Beijing's penalties include electric cars.

Tesla is gaining around early Wednesday after the company announced it has secured a site in Shanghai, China, to build its first overseas Gigafactory.

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.

The website of Shanghai Land Market, however, shows the original starting price of the land for sale was 973 million yuan (about 141 million USA dollars).

Tesla Inc (NASDAQ:TSLA) previously announced plans for a factory in China have taken a major leap forward.

The land agreement for the mega-factory marks a key step for the United States electric carmaker to produce vehicles locally in China for the fast-growing market, Reuters reports.

However, by July Beijing reversed course amid ongoing trade disputes with the Trump administration.

Above: Tesla and Shanghai officials at a signing ceremony. The electric vehicle maker has purchased a massive patch of land on which its vision will become reality.

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. The Chinese government is aiming for NEVs to make up 20 percent of all vehicle sales by 2025, in an effort to curb pollution in the country. For the first nine months of this year, new-energy vehicle sales across mainland China jumped by 81.1 per cent from a year ago to 721,000 units. If that continues to grow and the Chinese Gigafactory comes online, it won't be long until 500,000 vehicles a year seems like a tiny amount.

In July, Tesla signed a deal with the Shanghai government to open a plant in the city with an annual capacity of 500,000 cars.

Other reports by Click Lancashire

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