Tesla Wants to Build Electric Car Factory in China

For the most part, Tesla has been pretty good about keeping jobs in the United States. The electric cars are built at the Tesla Factory in Fremont, California and they’ve also got the Gigafactory 1 in Nevada for making lithium-ion batteries. That could soon be changing, because the company is looking into building an electric car factory overseas in China.

Is this an extension of Elon Musk’s response to Trump pulling out of the Paris accord? Maybe. Maybe not. According to the report by Reuters, Tesla is looking specifically into building an electric car factory near Shanghai and they want to “more clearly define its plans” by the end of the year.

Tesla is rapidly expanding and its existing facilities will not be capable of producing the volume they want to produce. Elon Musk wants to pump out half a million electric cars by 2018. The factory in China will make it much easier for the company to reach customers in global markets, but also more specifically in the rapidly growing market in China itself.

In an official statement, Tesla said that they expect that “most of our production [will] remain in the US, [but] we do need to establish local factories to ensure affordability for the markets they serve.”

The other big advantage of building a Chinese electric car factory? Tesla can then skip the 25-percent tariff on imported vehicles into the country. That can, in turn, reduce the price for Chinese customers and theoretically increase demand, getting Tesla that much closer to its goal of 500,000 cars.