Tesla China plans to build a plant for the first time

Tesla’s rumors of building factories in China have finally been confirmed. On Oct. 26, the spokesman of the Ministry of Commerce spoke highly of the peak for the first time that Tesla, an American electric vehicle manufacturer, is currently communicating with the Shanghai Municipal Government. In the face of China’s huge potential market, Tesla has already begun to deploy in the Chinese market. Tesla has matured from domestic production. However, as of now, Tesla is still not final signing, Tesla can build factories in China, has become the key to whether or not to maintain the brand advantage.

Domestic time comes

On October 26, at a regular press conference held by the Ministry of Commerce, Gao Feng stated that Tesla, an American electric vehicle manufacturer, is currently communicating with the Shanghai Municipal Government. China will greatly ease market access, expand opening to the outside world, and strive to create a legal, international, and convenient business environment for foreign companies to effectively protect the legitimate rights and interests of foreign investors.

Tesla’s progress on domestic production has finally been confirmed. In June this year, the National Development and Reform Commission and the Ministry of Industry and Information Technology issued a document granting exemption status to the pure electric passenger vehicle project. A foreign car company can establish a third Sino-foreign joint venture new energy automobile company in China. In September, Meng Wei, a spokesperson for the National Development and Reform Commission, said at the press conference that the National Development and Reform Commission will further liberalize foreign investment in areas such as new energy vehicles, and will continue to simplify foreign investment management procedures to support Beijing, Shanghai, Guangzhou and Shenzhen. Other megacities have taken the lead in increasing reform efforts.

The introduction and statement of a series of policies by the relevant government departments also means that the time has come for Tesla to build a factory in the Chinese market. The industry believes that Tesla is still the star of the electric car world, and that building a factory in China means that the price is reduced and it is easier to occupy the market.

The Chinese market is quietly laid out

In fact, the introduction of electric vehicle products in the Chinese market is not only an investment in models, but also needs to form a layout in the field of charging piles. From Tesla's development plan, Tesla will put more charging piles in the country to resolve the long waiting time for Tesla owners at peak charging time.

Since 2012, Tesla has started the construction of super charging stations and strives to deploy the Chinese market. As of now, Tesla has established more than 700 super charging stations in mainland China, covering 170 cities nationwide. According to the plan, Tesla Super Charge Piles will exceed 1,000 at the end of this year.

After one year and a half of the implementation of the “New National Standard” Tesla finally compromised and announced on October 16 that it will put the Model S and Model X models that meet the “new national standard” charging interface to the Chinese mainland market. The plan will be around 2018. Completed in half a year.

At the same time, the world's largest Tesla supercharger station also settled in Shanghai this month, the super charging station can charge 50 Tesla at the same time.

Cui Dongshu, secretary-general of the National Passenger Vehicles Association, said that for Tesla, the Chinese market is very important. If localization is under cost advantage, it will be recognized by more and more consumers and become the second largest. This is an important opportunity to take off.

The process is slowly testing

Although the establishment of Tesla is imperative, the failure to reach an agreement has caused the industry to worry about Tesla's prospects. Tesla CEO Musk once said that Tesla will achieve an annual output of 500,000 vehicles by 2018 and a million by 2020. However, in the third-quarter data released by Tesla, the Model 3 only produced 260 vehicles, which was far behind the claim that “the output in September was 1,500 units and the output in December exceeded 20,000 units.”

The Model 3 capacity issue also dragged down the electric truck that was expected to be released on October 26. The truck's on-line time has been postponed until November 16. Therefore, the capacity bottleneck has become one of Tesla's urgent problems to be solved, and building a plant in China is seen as the key to expanding Tesla's production capacity.

However, while Tesla has been rumored to build factories in China, other luxury brands are also accelerating their deployment in China. Industry insiders believe that Tesla’s establishment of a factory in China is more urgent than other international giants. At present, multinational brands have established joint venture factories in China. Tesla’s unwillingness to share technology with Chinese companies is the main reason that has hindered its establishment in China. With the further liberalization of foreign investment policies in new energy vehicles, Tesla finally ushered in domestic opportunities. However, whether Tesla can realize its dream of localization still requires the approval of the last government. Tesla, whose domestic progress is slow, can catch up with the multinational brands that have been deeply plowed in China for years.