Tesla, through its Chinese arm, is reportedly contemplating to resume the Phase III expansion of the Gigafactory Shanghai. The automaker is assigning the area for the production of the highly awaited $25,000 electric vehicle, local media Late Post reports, citing sources familiar with the matter.
Report highlights
The report asserted that Tesla actually started the necessary preparations for Giga Shanghai’s Phase III expansion with the aid of a dedicated team in 2021. However, the electric automaker halted the preparations in mid-2022.
Interestingly, industry insiders apparently suggest that Tesla may finally kick off the $25,000 EV production if the company manages to accelerate the Phase 3 area development.
It is worth noting that the highly anticipated model will ride on Tesla’s next-gen platform, which will supposedly aid its 2030 production target of 20 million EVs per year.
Giga Shanghai’s production prowess
Teslarati noted that Giga Shanghai remains the leading factory of the Musk-led company when it comes to production efficiency.
In fact, it currently has a production rate of 37 seconds per electric car. In comparison, Giga Texas takes 76 seconds on average.
Recent reports also imply Tesla’s plans to increase the production capacity of the Chinese factory by twofold to 2 million EVs once it completes the Phase III development.
The Q3 2023 Update Letter revealed that the Giga Shanghai currently has an annual production capacity of more than 950,000, beating Tesla’s other production plants across the world.
Tesla to build a Megafactory in China
Tesla’s possible development at the Giga Shanghai could accelerate the production of the cheaper, next-gen Tesla EV in the Chinese market.
Tesla has yet to confirm the local reports. If the speculation turns out to be true, the automaker will end up with two major development projects in China.
In hindsight, the EV giant recently agreed with Shanghai’s Lingang officials to construct a local Megafactory to produce the Megapack battery. It will apparently have an annual production output of 40 GWh.
Tesla is undoubtedly at risk with strong competition against Chinese automakers in the local market. That said, launching a low-cost model offering will significantly aid the company in defending its dominant position. It will also accelerate the company’s progress towards the sales target of 20 million EVs by 2030.
