Tesla’s plans to build a Megafactory in Shanghai are once again in the news. According to sources, the company expects to begin construction in May.
The Megafactory in China will be Tesla’s first energy storage factory outside the United States. The facility’s initial planned annual production capacity will be up to 10,000 commercial energy storage batteries per year, equivalent to 40 GWh. According to sources from local media outlet, The Paper, production will begin in the first quarter of 2025. The publication refers to Tesla’s internal source.
Plans for the construction of the Megafactory are delayed. It was previously reported that the company will begin construction of the factory in the first quarter of 2024. Tesla first announced the construction plan in April 2023, signing an agreement with the authorities of Lingang, Shanghai. According to the plan, the new facility would complement the electric vehicle manufacturing facility located there.
The Megapack factory in China is an excellent strategic move. This will increase production, which is important given the growing demand for commercial energy storage batteries. In addition, by producing batteries in China, they can be quickly delivered to Europe, Australia, Africa, and other countries located in nearby regions. In China, energy storage systems are also in high demand.
Tesla’s energy storage business is growing at a rapid pace in recent years. In 2023, installed capacity reached 14.7 GWh, up 125 percent from last year. The expansion of production space will undoubtedly lead to further rapid business growth. Tesla expects continued growth in 2024. In its 2023 report, the company said that this year, the growth rate of deployments and revenue in its Energy Storage business should outpace the Automotive business. The manufacturer continues to ramp up production at its 40 GWh Megafactory in Lathrop, California.
