Tesla to Build Megafactory in Shanghai for Megapack Production

Tesla, the electric car maker, has announced that it will build a new megafactory in Shanghai, China, dedicated to manufacturing its energy storage product Megapack. The new factory will add to Tesla’s existing factory for electric vehicles in Shanghai and will initially produce 10,000 Megapack units every year, equivalent to around 40 GWh of energy storage. Our range of products will cater to the worldwide market.[0] According to Xinhua News Agency and state television, the plans entail manufacturing 10,000 Megapack units every year. The Megapack factory in Lathrop, California, which Tesla built last year to meet the growing demand for the Megapack, has an annual capacity of 40GWh or 13,000 Megapacks.[1]

The announcement was made at a signing ceremony attended by Tesla’s senior vice president of automotive, Tom Zhu, and Shanghai government officials, including vice mayor Wu Qing, with Tesla Vice President Tao Lin signing the contract.[2] This move indicates Tesla’s aim to improve its global production layout and accelerate the world’s transition towards sustainable energy.

The Megafactory project is scheduled to start construction in the third quarter of 2023 and start production in the second quarter of 2024.[0] In the Shanghai Free Trade Zone, the Lingang New Area has been selected as the location for the construction of the factory.[3] The initial plan for production is to create a maximum of 10,000 Megapacks annually, each with an energy storage capacity of approximately 40GWh.

Tesla’s Megapack is a super-sized commercial energy storage battery, designed for large-scale storage and renewable energy projects. The Megapack is a container-sized battery system that can store up to 3 MWh of energy and can be used to provide grid-scale energy storage, backup power, and load shifting. It is designed for commercial and industrial customers who need large-scale energy storage solutions.

This signing is a move by Tesla to promote the development of Shanghai’s new energy storage industry and green low-carbon transformation, while also demonstrating Shanghai’s commitment to attracting and utilizing foreign investment, continuously creating a market-oriented, rule-of-law-based, and international business environment.[4]

The new factory is part of Tesla’s strategy to expand its presence in China, the world’s largest market for electric vehicles. Tesla’s factory in Shanghai, which opened in late 2019, is already producing Model 3 and Model Y cars for the Chinese market. Tesla has been expanding its production capacity in China to meet rising demand for electric vehicles in the country.

The move by Tesla comes at a time of brewing tensions between Beijing and Washington. The US and China are locked in a trade war, with both countries imposing tariffs on each other’s products. Tesla has been seen as being able to navigate the tensions between the two countries with relative ease.[0] The company’s production capacity in China will also help it to avoid the tariffs imposed by China on US-made electric cars.

In conclusion, Tesla’s new megafactory in Shanghai will be a boost to the company’s production capacity and will enable it to meet the growing demand for its energy storage products. The factory will also help Tesla expand its presence in China, the world’s largest market for electric vehicles, and will allow it to avoid the tariffs imposed by China on US-made electric cars. The move by Tesla is a significant step towards accelerating the world’s transition towards sustainable energy.

0. “Update: Tesla to build new mega factory in Shanghai” Xinhua, 9 Apr. 2023, https://english.news.cn/20230409/c7e4c044823246a1ad204cd02dc496d3/c.html

1. “Tesla To Announce A New Megafactory In China Confirms New Job Opening” Torque News, 31 Mar. 2023, https://www.torquenews.com/11826/tesla-announce-new-megafactory-china-confirms-new-job-opening

2. “Tesla (TSLA) to Build Megapack Battery Factory in Shanghai” Bloomberg, 9 Apr. 2023, https://www.bloomberg.com/news/articles/2023-04-09/tesla-to-build-megapack-battery-factory-in-shanghai-xinhua

3. “Tesla Builds A Megafactory in Shanghai” Pandaily, 9 Apr. 2023, https://pandaily.com/tesla-builds-a-megafactory-in-shanghai/

4. “Tesla, Shanghai sign agreement for new megafactory” SHINE News, 9 Apr. 2023, https://www.shine.cn/biz/auto/2304095434/