Tesla buys the land it needs for its Shanghai Gigafactory
It paid over $140 million for around 860,000 square meters.
Tesla has secured an 860,000 square meter plot of land in Shanghai for its first overseas Gigafactory after signing an agreement with the local government. The EV-maker confirmed the purchase on Chinese social media, complete with pics from the signing ceremony of the "land transfer agreement." Though Tesla didn't reveal the price, Reuters reports that the Shanghai Bureau of Planning and Land Resources said that the plot fetched 973 million yuan ($140.51 million) at auction.
The deal marks the culmination of groundwork that stretches back to June, 2017, when talks for a factory began between the Shanghai authorities and the EV-maker. A deal was then officially announced in July of this year, with Tesla later adding that it was "accelerating" plans for the site's development -- spurred by a scathing import tariff rate of 40 percent on its vehicles, compared to 15 percent for other car imports.
With the new agreement, the company says it's "on track" to "achieving its goal" of gaining a foothold in China, the world's largest market for electric vehicles. Which in turn should help it drive down costs by around a third and boost its bottom line. The big question, of course, is whether Tesla (a profitless company) will run out of money before Gigafactory 3 can be completed. It needs to rustle up a billion dollars for creditors before the year is out, reports Business Insider -- a sum it currently doesn't have.
The official website for #Shanghai land transactions shows that #Tesla has secured a plot of land for 973 million yuan for its planned factory in the city.
— YUAN TALKS (@YuanTalks) October 17, 2018
— YUAN TALKS (@YuanTalks) 2018年10月17日
译文来源：三泰虎 http://www.santaihu.com/46334.html 译者：Jessica.Wu
those could’ve been American jobs, arent trade wars great?!
It's someplace Tesla can test and develop it's solar tech on a large scale, unhindered without resistance from the government and in a place where they welcome clean energy. Its a huge market and opportunity for Tesla. China is the global leader in investing in clean energy.
The real question is Did they buy? or will Tesla pay yearly taxes on the property?
If they pay property Taxes like AMERICANS do, They they are not the OWNERS, They are merely RENTING, Should they miss any payment the Property reverts back to the STATE.
I don't get it, why Tesla is a "profitless" company?
The mass sales of EVs will tie in nicely with the Chinese governments recent clamping down on pollution sources. They look at this way; before more and more middle class get into cars, let's fix the problem before it gets worse. Point them down another path.
This is Tesla's first major mistake of epic proportions. Selling into a country without the rule of law is one thing. Actually investing in it is something else. There is no doubt in my mind that whatever Tesla invests here will be totally and irretrievably lost within ten years.
There's no doubt in my mind that Tesla's investment is a smart one. If for no other reason than to ameliorate the effects of the tariff war our dim-witted President began.
Just another way for China to steal intellectual secrets from an American company. Everybody knows the story. In Order to open a facility in China, you have to have a Chinese counterpart company. That company steals the manufacturing secrets and opens up a competing factory that sells essentially the same product but, at half the cost and lower quality.
In case you didn't notice it's US who literally sends millions of manufacturing ideas and product designs so that China can produce it for you and the rest of the world...
What secrets would that be in this case? China already has a number of "giga factories" that can produce batteries at the same or lower cost than Tesla. China has already overtaken the US in terms of electric vehicle sales - those batteries come from somewhere.
Tesla doesn't compete based solely on cost, which is to say a budget EV isn't going to cut into their sales. Their brand is based on quality, safety, and performance. They are a premium brand. That said, it is Elon Musk's personal goal to promote the growth and rapid adoption of electric vehicles throughout the world, so more EVs strengthen the infrastructure and validate Tesla rather than cut it down. Remember a couple years ago when he publicly released nearly all of Tesla's patents? Volume and competition bring down prices, lower prices brings more electric cars. More electric cars replaces more internal combustion cars. Planet gets saved from human pollution faster.
From my prospective, this is a bad business move. When you consider the progress other car manufactures are making in the development and manufacturing of electric vehicles, and the uncertainty and tariffs on goods in China. This all equals lower volume of sales with very strong competition.. Extremely risky. Teslas "hay day" is about to come to an end. To his credit, he did lead the way in electric vehicles, but as I stated earlier, his notoriety is at its end.
I doubt they will have any trouble securing funding for this. It's a relatively safe bet for investors. If Tesla succeeds, they make inroads in the largest EV market on Earth, investors will make lots of money. If they fail and go under, there will be no shortage of Chinese companies looking to acquire the factory so investors will still make their money back. They'll have little trouble getting the money for this.
Investors also know how quick Chinese companies can copy any technology used in local factories. I'd be wary. Not to mention I'd have to wait in line for other "investors" to recover their +$10 billions and then make a profit.
I don't see how it is the largest EV market when 3/4 of the population don't have electricity or indoor plumbing.