The agreement reportedly being worked out with municipal authorities in Shanghai will enable Tesla to build a factory in Lingang Development Zone.
The agreement can be signed already this week – now is finalizing the details. But Tesla did not comment on the development. Government support helped China surpass the U.S. in 2015 to become the world’s biggest market for the non-emission autos.
Telsa Inc. (TSLA) shares are expected to open sharply higher Tuesday amid reports the group may open a new production facility in China, a move that would avoid tariffs in the world’s second-largest economy but risk the ire of U.S. President Donald Trump’s “buy American, hire American” industrial policy.
Tesla’s CEO Elon Musk also said last year the company is looking to secure a location and a partner in China for a facility by the middle of the year, but an announcement was never made, Electrek added. The average 1-year price objective among brokerages that have updated their coverage on the stock in the last year is $295.51. Next month, Tesla is slated to begin rolling out the Model 3, a more affordable and smaller electric sedan.
Tesla would begin rolling out the Model 3, a more affordable and smaller electric sedan, in the USA next month, while it is yet to launch the Model 3 in China. In the United States, consumers stood in long lines to place $1,000 deposits for the vehicle.
Speculations regarding such a deal started in March when Tencent purchased a 5% stake in the US firm. The country aims to boost annual sales of plug-in hybrids and fully electric cars 10-fold in the next decade.
Tesla purchased its only vehicle assembly plant in Fremont, California, from Toyota Motor Corp.in 2010 for just $42 million.