Reuters reports that Tesla is in the process of preparation to expand its manufacturing capacity at the Gigafactory 3 in Shanghai from around 150,000 cars annually to around 250,000-260,000 cars annually.

A document submitted by Tesla to the Shanghai government, seen by Reuters, indicates the intention to expand production of battery packs, electric motors, motor controllers and other components.

"Tesla wants to almost double its annual building capacity for cooling pipes, a key part in a car’s heat management system, to 260,000 sets a year from 150,000. It did not provide capacity details for other parts."

"The company is also building an additional stamping line to speed up car production in Shanghai, according to construction documents seen by Reuters."

As of the end of December, about 70% of the parts in the Made-in-China (MIC) Model 3 were imported parts, while Tesla's ultimate goal is to rely only on parts produced locally in China.

The new production number of 250,000 cars per year would include the new Tesla Model Y.

We also guess that in the near future, Tesla might officially expand Model 3 production in China from the entry-level Standard Range Plus (RWD) version to also Long Range/Performance and AWD versions.

Tesla Gigafactory 3 facts:

  • location: Shanghai, China
  • wholly-owned subsidiary (not joint venture)
  • expected total investment: about $2 billion
  • construction was started in January 2019
  • purpose: production of affordable versions of Model 3/Model Y for greater China region (higher cost versions of 3/Y and all S/X to be produced in the U.S.)
  • battery packs will be assembled using lithium-ion cells from various suppliers, including Panasonic
  • expected volume: 150,000 per year in the first phase and 500,000 per year in the future
  • Targets: production of cars (between 1,000 to 2,000 per week by the end of 2019) to start in the second-half of 2019 (volume production, of 3,000 cars per week initially, from 2020),
  • First customer deliveries of Made-in-China (MIC) Model 3 happened on December 30, 2019
  • Elon Musk officially announced Model Y program at Gigafactory 3 on January 7, 2020
  • Tesla was able to achieve a production rate of about 280 cars a day (10-hour shift) or almost 2,000 a week in December 2019. The production capacity was up to 3,000 cars per week. Production of battery packs started in December 2019 (but at the time not yet at the rate of car production).
  • The production was resumed on February 10, 2020, after an extended break, caused by the fight with coronavirus
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