Tesla preparing for expansion at Giga Shanghai to produce $25K EV: Report

Tesla is reportedly set to begin a significant expansion at Giga Shanghai, an expansion that would pave the way for the production of their $25K electric vehicle (EV).

According to a report from local Chinese media outlet Late Auto, the third-phase expansion of Giga Shanghai was initially planned in 2021 but then halted in the middle of last year. In early 2023 it was reported that Tesla wanted to double the factory’s annual capacity to 2 million units. However, approval to go ahead with construction did not come, reportedly because of concerns from the Chinese government over Starlink.

It appears as though those concerns have been erased. According to insiders the expansion is now back on the plans, suggesting that Tesla may not only be getting back to work soon, but may also shift its attention to use the new area to produce the company’s next generation platform with a lower price point.

If the report is accurate, and crews in China are able to build the third-phase as quickly as they built the first phase, then Giga Shanghai will likely become the second factory to build the next-generation platform. After originally planning to build it at Giga Mexico, delays in the start of construction of that factory have forced Tesla to shift their plans and instead build the $25K EV at Giga Texas.

The shift allows Tesla executives to keep a close eye on the project without having to travel to Mexico. CEO Elon Musk reiterated those plans this week in a newly released interview with Sandy Munro, saying the company is progressing quickly with their plans.

“We are working on a low cost electric vehicle that will be made at very high volume. We’re quite far advanced in that work. I view the production line plans for that every week and I think the revolution in manufacturing that will be represented by that car will blow people’s minds,” Musk said.

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