Tesla May Build a Second Factory in Shanghai

Published: Mar 1, 2022 13:32

Save

It is reported that Tesla may build a second factory in China in Lingang area, Shanghai, and the new factory is expected to start construction as soon as next month. Tesla’s annual production capacity in China may increase to 2 million vehicles after the completion of the new factory.

SHANGHAI, Mar 1 (SMM) – It is reported that Tesla may build a second factory in China in Lingang area, Shanghai, and the new factory is expected to start construction as soon as next month. Tesla’s annual production capacity in China may increase to 2 million vehicles after the completion of the new factory. However, Tesla and relevant departments in Shanghai have not yet responded to the news.

Why to build a second factory?

Insufficient production capacity is a problem that has always plagued Tesla. Consumers need to wait at least 14-16 weeks to buy a Tesla, because the current production capacity of Tesla's Shanghai factory is capped at 500,000 vehicles, and the sales in January this year has reached 59,845 vehicles. Secondly, compared with Europe, China's COVID-19 control measures have provided a safe environment for production. Therefore, building a second factory in China is a wise choice.

Why to choose Shanghai?

Transportation: Compared with the digital 3c products, the new energy vehicles are larger in size. The cost of water transport is 1/2 of railway transport, 1/5 of the highway, and 1/20 of the aviation. As such, shipping by sea is more cost effective. Tesla's second factory also supply vehicles to the Japanese and European markets, for which shipping is particularly important. Shanghai has an excellent port system, which can radiate the Yangtze River Economic Belt, and can connect the whole world.

Technology: There are many domestic colleges and universities in the Yangtze River Delta, and Shanghai is a gathering place for high-tech talents across the country, providing a talent pool for Tesla's development.

Economy: Tesla need to choose a city with a high starting point, fast development, and high technology, which can meed its production demand. As the largest commodity distribution centre in China, Shanghai meets 90% of Tesla's needs for parts production. Shanghai has strong advantages in terms of transportation, land construction, and development speed.

Tesla factory

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

2 hours ago

SoftBank to Produce In-House Batteries for AI Data Centers

According to Bloomberg and other major media outlets on April 24 (local time), SoftBank has begun preparations to convert part of its factory in Sakai into a large-scale battery production line. The company aims to establish production capacity of several gigawatt-hours (GWh) within the next five years, which is expected to become one of the largest battery manufacturing facilities in Japan.

2 hours ago

Samsung SDI to Begin Mass Production of Next-Gen BBU Battery in Malaysia

Samsung SDI will start commercial production (SOP) of a new battery cell for battery backup units (BBU), a key component for AI data centers, at its Malaysia plant in July. According to industry sources on April 23, Samsung SDI will mass-produce its 21700 cylindrical battery cell “40V3” — first unveiled earlier this year — at the facility.

2 hours ago

4 hours ago

[SMM Analysis] Energy Density Demand Surges, Silicon Carbon Anode Expansion Hits the "Fast-Forward Button"

[SMM Analysis: Surging Demand for Energy Density Presses the "Fast-Forward Button" on Silicon Carbon Anode Capacity Expansion] As the demand for high energy density from high-end batteries continued to surge, silicon carbon anode products based on the CVD route from top-tier enterprises successively passed downstream client verification and achieved large-scale shipments.

4 hours ago