Tesla to build Shanghai factory to make Megapack batteries

© Reuters. FILE PHOTO: A Tesla signal is seen at its manufacturing unit in Shanghai, China, Could 13, 2021. REUTERS/Aly Track

SHANGHAI (Reuters) -Tesla Inc will construct a manufacturing unit in Shanghai to make the Megapack vitality storage product, Chinese language state media outlet Xinhua reported on Sunday.

Elon Musk’s automaker will break floor on the plant within the third quarter and begin manufacturing within the second quarter of 2024, Xinhua reported from a signing ceremony in Shanghai.

Complementing an enormous current Shanghai plant making electrical autos, the brand new manufacturing unit will initially produce 10,000 Megapack items a 12 months, equal to round 40 gigawatt hours of vitality storage, to be bought globally, Xinhua stated.

With the brand new Shanghai plant, Tesla (NASDAQ:) will reap the benefits of China’s world main battery provide chain to ramp up output and decrease prices of its Megapack lithium-ion battery items to satisfy rising demand of vitality storage globally because the world shifts to make use of extra renewable vitality.

Tesla generates most of its cash from its electrical automotive enterprise, however Musk has dedicated to develop its photo voltaic vitality and battery enterprise to roughly the identical measurement.

Chinese language battery big CATL has additionally been deepening its collaborations with purchasers together with Tesla in vitality storage battery provides, which its Chairman Robin Zeng anticipated to have a bigger market than batteries powering electrical autos (EV).

Tesla at present has a Megafactory in Lathrop, California, able to manufacturing 10,000 Megapacks per 12 months.

The corporate started producing Mannequin 3 automobiles in Shanghai in 2019 and now could be able to producing 22,000 items of automobiles per week.

Tesla deliberate to develop the Gigafactory Shanghai, its best automaking plant, so as to add an annual capability of 450,000 items, Reuters reported final Could.

The U.S. firm, nevertheless, had grappled with rising stock in Shanghai as demand began weakening within the third quarter, resulting in aggressive value cuts in its main markets globally in January.

EV gross sales development in China, the world’s largest auto market, has slowed to twenty.8% within the first two months of 2023, from 150% in the identical interval a 12 months in the past.