Tesla nearing deal to build its own plant in China

Robots assemble Model S Tesla’s 5.3-million-square-foot plant in Fremont CA. Source David Butow  For The Times

Robots assemble Model S Tesla’s 5.3-million-square-foot plant in Fremont CA. Source David Butow For The Times

Tesla can explore setting up shop in China on its own as authorities consider allowing overseas auto makers to set up wholly owned electric-vehicle factories in free-trade zones.

The company increased the borrowing capacity under certain warehouse loan agreements, which are specialized loans to help companies finance inventory, the company said in a filing and a spokesman said financing was related to Tesla's auto lease program. Tesla would still have to pay the 25 percent import duty, but it would retain full control and could likely offset the tariff with lower production and shipping costs. But China has now considered permitting foreign carmakers to establish wholly-owned plants in free-trade zones as part to encourage more production of electric and hybrid vehicles, which the government calls "new energy vehicles" to meet the sales quotas. The electric-car maker led by Elon Musk said at the time that it planned to define its plans more clearly by the end of the year.

In a bid to gain traction in China's growing electric vehicle market, Tesla is setting up a manufacturing facility in Shanghai, according to the Wall Street Journal.

Tesla is reported to have agreed to set up a plant in the city's free-trade zone. Tesla is deeply committed to the Chinese market, and we continue to evaluate potential manufacturing sites around the globe to serve the local markets.

Tesla is going worldwide, and it's reportedly headed to the world's biggest consumer of electric vehicles to build a new factory. Nonetheless, the electric vehicle maker shall still be required to pay China 25% of the import tariff. The factory is to be set up in Shanghai's free-trade zone.

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He also said that he has to defeat BJP in Gujarat and will campaign against them. "This is an election of six crore people of Gujarat".

It could be that this deal Tesla has brokered removes the tariff somehow.

Tesla is wrestling with production problems at its sole factory, in Fremont, California. Then there are companies like Volkswagen that sell 11 million cars this year, and produce a profit of 13 or 14 billion euro.

Buyers from India waiting for the Tesla Model 3 are supposed to get their vehicles sometime in 2019.

Tesla does face the government of China which is autocratic and conservative in its outlook despite being a far cry from the communist regime of bygone times.

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