According to the Shanghai government, this will be the largest foreign-invested manufacturing project in the city's history, although detailed investment was not revealed.
The factory will alter the geopolitical terrain of battery production. The Model 3 was created to be Tesla's first mass-market vehicle, meant to broaden the company's customer base beyond the luxury segment and increase the rate of electric-vehicle adoption.
Of course, Mr Musk is far from the first American tech entrepreneur to jet into China for 72 hours and pen a love letter to the country. They stated, "The Shanghai municipal government will fully support the construction of the Tesla factory". In addition to avoiding China's import duties on US-made cars, a plant in China also will reduce shipping costs and potentially make sourcing components more economical.
The $7,500 federal tax credit for electric vehicles is set to start phasing out for the Model S, Model X and Model 3 after Dec.31, according to the company's website.
China's fast-growing market for new-energy vehicles presents a massive growth opportunity for Tesla. The government's target is seven million vehicles a year by 2025.
‘Fortnite’ Season 5, Week 1 Challenges Guide
There's also Road Trip tier rewards (similar to Blockbuster challenges from last season) as well as Drift Challenges. Grab your squad and cruise the map in style! The patch notes also tease new Rifts that can be interacted with.
People walk past a showroom outside Tesla China headquarters at China Central Mall in Beijing, China July 11, 2018.
Norway has declined a suggestion it is holding up Tesla's attempts to improve service in its third-biggest market, saying the electric automaker has not yet applied to utilize the mobile service vans it says it needs to resolve its issues.
The innovation center was officially registered on October 18, 2017, three years after Tesla's entrance into China in 2013.
At the end of June, Tesla, as well as GM, was said to be very close to hitting the 200,000 US delivery cap.
Tesla did not immediately respond to a request for comment, but the company told Fortune in June that production numbers couldn't be faked because the figures are "updated in real-time on screens in the factory, plainly visible to anyone passing by". But Musk has said the company will become profitable in the second half of this year.