Tesla secures Shanghai site

Tesla has signed an agreement with the Shanghai government for an 860,000 square meter plot of land to build its first overseas Gigafactory.

The land agreement marks a key step toward the firm and Tesla CEO Elon Musk manufacturing cars locally in China for the fast-growing market. 

Tesla signed a long-anticipated deal with Shanghai authorities in July to build its first factory outside the United States, which would double the size of its global manufacturing and help lower the price tag of Tesla cars sold in the world’s largest auto market.

“Securing this site in Shanghai, Tesla’s first Gigafactory outside of the US, is an important milestone for what will be our next advanced, sustainably developed manufacturing site,” Robin Ren, Tesla’s vice president of worldwide sales, said in a statement to Reuters. 

Tesla did not give the price tag for the plot, but the Shanghai Bureau of Planning and Land Resources said on Wednesday that a plot of land of 864,885 square meters had been sold at auction at a price of 973 million yuan (NZ$214 million).

The factory will help tap China’s rapidly growing market for new-energy vehicles (NEVs), a category comprising electric battery cars and plug-in electric hybrid vehicles.