Tesla, the American electric vehicle manufacturer, on Monday, delivered the first batch of cars produced at the multibillion-dollar Shanghai "Gigafactory". The work on the company's first plant out of United States began less than a year ago. The commencement of production at the China factory is now going to help Tesla avoid the current trade tensions between US and China and sell its car directly in the former which is considered to be the world's largest "green" vehicle market. The new Tesla plant was up and running in 357 days.
The first cars which were rolled out of the assembly line in the China plant were 15 examples of the Model 3, Tesla's mid-price electric sedan. These were handed over to Tesla employees which have placed advanced orders for the same. The electric vehicle manufacturer plans to begin large-scale deliveries of the China-made Model 3 sedans from next month. At the moment, Tesla is manufacturing more than 1,000 cars at the China factory. The company plans to double this figure by 2020 with the chief executive Elon Must hinting that the production can rise to 3,000 units per month in the near future.
When automakers want to establish manufacturing plants in China, it is typically required that they set-up joint-ventures with domestic firms in order to share profits and technology. In the case of Tesla, it still continues to be a wholly-owned by the US company and it has been awarded with preferential treatment. Chinese authorities, in the last week, announced a 10 per cent waiver on the purchase tax for locally manufactured Model 3 vehicles. Tesla models are priced at 355,800 yuan or USD 50,900. Earlier this year, a subsidy of 25,000 yuan per car.
"From now onwards China-made Model 3 vehicles will start running on China's large streets and small lanes," Tesla Vice President Tao Lin said at the delivery ceremony which was attended by employees and Shanghai government officials.