Tesla, US EV manufacturer, builds first overseas plant in China

Despite the dispute between United States and China over trade and tariff, American electric car manufacturer Tesla has set up its first overseas plant in Shanghai in a record time of 168 days and plans to start delivering its Model 3 to Chinese buyers from January onwards.

China has reportedly waived off import duties to enable Tesla to sell the car at a relatively modest 50,000 US Dollars or 3.7 million Indian Rupees (3.55 million Yuan). As and when the model manufactured in its plant in California is offered in India, the price is expected to be in the range of INR 50 lakhs. It will even then be cheaper because most tesla models are offered at prices ranging between INR one to two Crore.

Tesla and its owner, Eon Musk, claim that the Shanghai plant took just 168 days from receiving the first permit to electrifying the plant and receiving the final clearance. The plant has been set up with loans advanced by Chinese banks and on condition that all the cars produced in the plant will be sold within China.

Tesla, which was set up in 2003, manufactures only electric cars and uses Panasonic batteries. Its top-end cars are claimed to run for nearly 500 kilometres on a single charge.

China is said to be building as many as 20 EV towns to give a fillip to the manufacture of electric vehicles. China is also committed to relaxing caps on foreign ownership of auto companies by 2022. Currently Western auto makers needed a China based joint venture partner and cannot hold more than 50% of the shares.

Tesla is said to be the first completely foreign owned manufacturing facility in China, the world’s largest auto market.

Tesla announced last week that its Model 3 electric vehicle was open for booking and the first batch is expected to be delivered to customers in the first quarter of 2020.

The Tesla Shanghai gigafactory, the largest foreign-invested manufacturing project in Shanghai, broke ground in January this year.