Tesla is planning to restart construction of the third phase of the Giga Shanghai factory, which is dedicated to producing a new 25,000 USD vehicle, local media reported.
In April, Tesla announced it would build a new energy storage factory in Shanghai with an annual output of 40 GHw, starting production in the second quarter of 2024. At that time, Tesla didn't mention any plans for phase 3 of the Giga factory expansion.
People familiar with the matter confirmed that Tesla started preparations for phase 3 in 2021 and formed a team but suspended the actions in the summer of 2022. The team responsible for factory expansions has been transferred to other departments.
According to media, the production capacity of the third part of Giga Shanghai will be dedicated to a new US$ 25,000 (RMB 150,000) vehicle, which Tesla teased in 2020 and is essential to reach the company's target of EVs sold annually by 2023.
Tesla's Shanghai plant produces only Model 3 and Model Y. It has a large annual capacity, Shanghai is Tesla's most efficient production plant. It takes 76 seconds for Tesla's Texas factory to roll off a car, while it takes only 37 seconds for the Shanghai factory.
The 40 GWh Mega factory in Shanghai, as Tesla calls its energy storage plants, will be the first outside the US market. It will produce energy storage for global and domestic markets. Press reported unnamed sources saying that Tesla will initially buy cells from CATL before switching to its batteries.
Media reported in January that Tesla planned to boost the output of the Shanghai plant, starting the phase-three mid-year, but the plan was put on hold because of Chinese government concerns over Musk's Starlink.
Elon Musk, Tesla's chief executive officer (CEO), said in an interview on December 5 that "significant progress has been made" in the mass production of this new 25,000 USD model.
According to previous information from the supply chain, this car will not be delivered until mid-2025 at the earliest.