Serious stuff is happening in Shanghai, the site of Tesla’s second manufacturing facility, company executives said on a phone call with investors. The carmaker’s “low-cost” Model 3 vehicles are already moving through assembly lines on a trial basis, and Musk heralded the “massive” stamping machines and in-operation paint shop. He also confirmed media reports that a second building is under construction in the Shanghai complex to handle battery and module production. Tesla hopes to produce 1,000 Model 3s a week from the factory by the end of the year. It will also produce Model Ys, its affordable crossover model, at the plant.

In its earning report, Tesla said it is working to finalize its local manufacturing license and to meet “other governmental requirements” before ramping up production in Shanghai.

That’s good news for Tesla, because China is vital to the carmaker’s future. Though the country’s economy has been buffeted by a trade war with the US, it still has among the most electric-vehicle-friendly regulations on the globe. Chinese car buyers shelled out for 1 million electric vehicles in 2018, and should buy 2 million next year, according to a report from Bloomberg New Energy Finance. Nearly 70 percent of China’s cars could be electric by 2040.

But China has, until this year, required foreign carmakers to link up with domestic ones to manufacture in the country, and avoid a 25 percent import duty. Tesla will be the first foreign company to take advantage of China’s new rule, which allows foreigners to produce vehicles in the country without a Chinese partner. The company believes China will be its strongest Model 3 market. Last month, one analyst said he suspected that Tesla sales in China are spiking up.

Sourced through Scoop.it from: www.wired.com