Tesla Inc., which got its fame from electric-powered cars, is now reportedly working on building a factory in Shanghai. The said factory will make the megapacks which are very powerful batteries with a lot of use cases.
This news was reported by the Chinese state media named Xinhua, which suggests that the production of this new factory is now a done deal rather than speculation.
As per the reports, the plant's ground-breaking ceremony will commence during 3rd quarter. As for production, Tesla is aiming for a deadline of Q2 2024, according to the media reports.
The new plant will complement the already existing Tesla plant in Shanghai, which mainly produces electric vehicles. According to reports, the new plant will produce 10,000 megapacks each year.
That's equivalent to energy storage of almost 40 gigawatt-hours and will help Tesla to ramp up its production.
For now, there's no doubt that the battery supply chain is the most advanced and modern in China. And once the new Tesla plant becomes operational, it will allow the company to increase its output and cut costs on producing lithium-ion battery packs.
With the rise in the use of renewable energy sources, the new Tesla plant in Shanghai will help the company to meet demand and earn more revenue.
Tesla's main revenue source is its electric cars business, but Elon Musk is committed to diversifying the company's revenue through battery and solar energy products sales.
For now, Tesla has one operational Megafactory located in California that produces up to 10,000 megapacks each year. But after the production of the new plant, Tesla will be able to produce an additional 10,000 megapacks each year.
Considering the main business model of Tesla and its focus on renewable energy sources & EVs, it makes sense for Tesla to increase its market share in the lithium ion battery business as well!