Tesla is building a huge battery factory in Shanghai even as trade tensions rise

Tesla is building a huge battery factory in Shanghai even as trade tensions rise

Hong Kong CNN — Tesla broke ground on a new manufacturing plant in Shanghai on Thursday, just weeks after CEO Elon Musk made a surprise visit to China in a bid to shore up the carmaker’s slumping sales.

The factory, which was announced in April last year, aims to begin production in the first quarter of 2025. It will be able to make 10,000 Megapacks — very large batteries used to store huge amounts of electricity — each year, according to a statement by , the government-owned developer of the area housing the plant.

The battery facility will be close to Tesla’s Shanghai Gigafactory, which is the company’s largest plant outside the United States, producing almost one million cars a year.

Megapacks are meant to be used to help stabilize energy grids. Each unit can store enough energy on average to power 3,600 homes for one hour, the company says. They are designed to be deployed by utilities and power stations.

The $200 million project comes as tensions between Beijing and Washington are rising over geopolitics and trade barriers, and underscores the US carmaker’s commitment to China, the world’s largest EV market and Tesla’s primary vehicle export hub.

“For Tesla, it’s an important milestone,” Tom