Tesla To Build Major Battery Plant In Shanghai

tesla, shanghai, gigafactory, megapack, battery

Tesla to build second plant for large-scale ‘Megapack’ batteries in Shanghai, supplementing production of California factory

Tesla said on Sunday it is to build a major new factory in Shanghai producing its large-scale “Megapack” batteries.

The facility is set to begin construction later this year and is intended to produce 10,000 Megapacks per year starting in the summer of 2024.

Each of the shipping container-sized batteries can store enough energy to power about 3,600 homes for an hour.

The units are intended to help stabilise power grids and prevent power outages.

Tesla's Gigafactory in Shanghai. Image credit: Tesla
Tesla’s existing Gigafactory in Shanghai. Image credit: Tesla


Tesla has constructed Megapack installations in several locations around the world, including Texas and South Australia.

Tesla chief executive Elon Musk said the new facility would supplement the firm’s existing Megapack plant in California, which also produces 10,000 units a year.

Musk told Bloomberg the units produced in Shanghai would be sold globally.

The company’s announcement comes at a time when the US has been pressuring American technology firms to shift more of their production to domestic plants.

Trade tensions

Last month the US Treasury Department updated guidance for a $7,500 (£6,040) electric vehicle tax credit, saying the minerals in the vehicles’ batteries must be sourced from the US and approved trading partners for the vehicles to qualify.

China is the world’s biggest battery producer and the US the EU, the UK and other regions are making efforts to reduce their dependence on the country.

The US administration has also recently said companies receiving federal funding under the $52bn Chips Act would be barred from expanding high-end production in China for 10 years.

Tesla opened its first overseas car factory in Shanghai in 2019 and is currently ramping production at a facility in Berlin.