Report: Tesla’s Production Plan for China Could Cost $10 Billion

July 11, 2018 at 11:22 AM

Tesla Inc.’s plans to open an electric-car assembly plant in Shanghai likely will include a huge battery factory as part of a complex that costs at least $10 billion, says Bloomberg News.

Huang Ou, deputy head of the Shanghai’s economy and information technology commission, tells reporters the project would be the city’s largest ever by a foreign investor. The plan includes construction of a Tesla EV innovation center in Shanghai.

Huang says the question of how much technology Tesla might transfer to a possible Chinese partner is “subject to negotiation between the enterprises.” He also tells reporters that Shanghai will accelerate China’s previously announced plan to eliminate rules that have limited foreign investment in car plants to 50% ownership, beginning with makers of all-electric cars.

Requiring foreign investors to share technological secrets for the right to do business in China has been a major reason for the U.S. trade war with China that was started last week by President Donald Trump.

Tesla aims to being building cars at the Shanghai complex within about two years of receiving approvals and permits. Achieving the facility’s 500,000-car capacity would take another three years, according to the carmaker.