Tesla Resumes Gigafactory Shanghai Expansion for Next-Gen Electric Car Production

Tesla's ambitious plans for the future of electric vehicles are taking a significant step forward as reports emerge of the company resuming construction on the Phase 3 area of Gigafactory Shanghai. The move suggests that Tesla is gearing up to introduce its much-anticipated, budget-friendly next-generation electric car in China.

According to sources familiar with the matter, preparations for the expansion of Giga Shanghai's Phase 3 began in 2021, with a dedicated team assembled for the project. Although the initiative experienced a temporary pause last year, recent indications suggest that Tesla is reactivating plans for this crucial phase.

Insiders in the Chinese industry speculate that the successful completion of Giga Shanghai's Phase 3 could prioritize the production of Tesla's affordable electric car, built on the highly-anticipated next-generation platform. This platform plays a pivotal role in Tesla's ambitious goal of reaching an annual production of 20 million vehicles by 2030.

Gigafactory Shanghai already stands out as Tesla's most efficient production facility, with an impressive 37 seconds needed for a car to roll off the line. The next-generation car, with its expected production efficiencies, promises an output that may set a challenging benchmark for competitors.

Initial reports indicated Tesla's aim to double Giga Shanghai's annual production capacity to 2 million vehicles through the Phase 3 expansion. In the latest Q3 2023 Update Letter, the Shanghai factory is currently listed with an estimated capacity of over 950,000 vehicles per year, making Giga Shanghai Tesla's largest global production hub by volume.

If recent reports from China hold true, Tesla is poised to embark on two significant construction projects in the country. In addition to the Gigafactory expansion, Tesla has also inked a deal with Shanghai's Lingang authorities to establish a Megafactory. This facility, akin to its counterpart in Lathrop, California, will focus on producing the Megapack battery—a key component of Tesla's large-scale energy storage solutions. The dual initiatives underscore Tesla's commitment to advancing both electric vehicles and sustainable energy solutions in the Chinese market.