Tesla to make car in China in 3 years

IRL/GB

Tesla to make car in China in 3 years

Tesla to make car in China in 3 years

Elon Musk, the founder and CEO of Tesla Motors has said that they are planning to manufacture cars in China in about 3 years.

The autonomous EV company is setting a “rough target” of producing cars in China around 2020 and in particular, the Chinese manufacturing plant will focus on the crossover vehicle, Model Y and Model 3 saloon cars for Asia markets.

There is a strategy to the move to China. Musk said that manufacturing Tesla’s lower-priced models close to their Asian markets will ensure their affordability.

Musk announced that Tesla plans to make a “couple hundred thousand cars per year” in China but they will not be spending major capital in the region until 2019.

The news comes days after the Wall Street Journal reported that Tesla had struck a deal to build a factory in Shanghai.

Musk delivered the details on the plans on a conference call following the release of Tesla’s third-quarter results, which were worse than analysts expected.

While the company plans to expand its international presence, analysts have expressed concerns over production delays with Tesla’s Model 3 and over the amount of money Tesla is having to spend to grow its businesses in autos and renewable energy. Michelle Krebs, senior analyst at Autotrader said:

“Tesla is learning what traditional automakers have long known – mass vehicle assembly is complicated and expensive,”

“A continued delay in Model 3 production and bigger losses were not the news hoped for with Tesla’s earnings report.”

Shares of Tesla were down about 5 percent this week and so analysts are carefully watching what happens the company next.

IRL/GB


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