Tesla Plant China Establishment is a First for the Country
Beijing – Tesla is going to become the first foreign car producer to wholly own its manufacturing operation in China. This deal will help the world in testing the relationship norms between Chinese Government and the foreign automaker. Previously this year in June, Tesla shared that it’s negotiating to manufacture cars in Shanghai. For months the Tesla Plant China has been put on hold, as the company is confused about what terms and production zone they should sign on. However, recently this week Tesla officially announced to set up a Tesla Plant in China.
According to the rules imposed by the Chinese government, foreign manufacturers are only provided with limited production options, which disable them from setting up their plants in the country. But with the establishment of Tesla plant in China, it looks like that China is finally opening its doors for foreign companies.
Tesla Plant China will be set up in Shanghai, as per their preliminary deal with the municipal government, who will also provide ownership facility and two people, who are familiar with the government negotiations. As of now, the company has declined to comment on any progress or status of the new venture. But Tesla Plant China will help China’s population, in getting a taste of what they are missing out, by restricting foreign manufacturers from their country.
China is and probably will be the largest producer and consumer of electric vehicles across the globe. Tesla Plant China can turn out to be significant project brand for the company if they wish to compete in the chase to become a global electric vehicle manufacturer. It is essential for Tesla to build a supply and manufacturing footprint in China. Tesla plant in China might act as a motivation for other brands to set up their manufacturing plant in China.