Tesla, the American electric vehicle manufacturer, advanced its initiative to produce energy-storage batteries in China with a land acquisition agreement for a new factory in Shanghai, as reported by China’s state media.
The construction of this facility is set to begin early next year, with production expected to start by year-end, according to Xinhua News Agency.
This factory will focus on producing batteries not for Tesla’s cars but for electric utilities and other businesses to store power, a crucial need due to the increasing reliance on solar and wind energy.
These renewable energy sources require storage solutions for times when weather conditions are not optimal for power generation.
The Shanghai factory aims to initially manufacture 10,000 of Tesla’s Megapack units each year, targeting a global market, as stated by Xinhua. This development is a significant boost for the Chinese economy, which has experienced a notable decline in foreign investment.
According to the Commerce Ministry, foreign investment dropped by 10% in the first 11 months of this year compared to the same period last year.
Concerns about the Chinese government’s growing influence over businesses and the tightening of U.S. technology trade restrictions with China are contributing factors to this decrease.
Despite these challenges, Tesla, led by CEO Elon Musk, has maintained strong relations with China, a key market and production hub for the company.
Tesla sold 464,654 vehicles in China in the first 10 months of the year, up 37.5% over last year and accounting for 12% of China’s electric vehicle sales, according to the China Passenger Car Association.
