onstruction has officially begun on Tesla’s new massive manufacturing plant on the outskirts of Shanghai, which, in the not too distant future, hopes to turn out half a million cars a year.
Elon Musk was in town on Monday for the groundbreaking ceremony. On Twitter, he explained that his company’s new “Gigafactory” would be focused on producing Tesla’s most affordable models, the Model 3 and the yet-to-be-revealed Model Y, for sale in Greater China.
Musk added that initial construction on the factory is scheduled to wrap up this summer with Model 3 production beginning by the end of the year and “high volume production” kicked into gear in the following year.
The factory is Tesla’s first outside of the United States. It is being developed in Shanghai’s Lingang Industrial Zone in partnership with the Shanghai government which has called the facility the largest foreign investment in manufacturing in the city’s history.
An initial target of 250,000 cars has been set. However, once the factory achieves “full production” that target will be raised to 500,000. For context, that number is about double Tesla’s current yearly production.
While Tesla has been forced to reduce prices in China over the past year because of the US-China trade war, the company still has high hopes for the Middle Kingdom. China remains the world’s largest market for vehicles, particularly green ones. In 2018, 1 million new energy vehicles were sold in the country. By 2020, China hopes to see that number surpass 2 million.