Tesla plays ahead: a Chinese flag planted in the mud and a crane already in action digging. Thus begins the adventure: in the desolate Chinese suburbs, near Shanghai, the next one will be born Tesla Gigafactory. The challenge set by Elon Musk is to get around the China-US trade war on imports and exports and finally go global.
Just today, Monday 7 January 2019, China and the USA talks on the article have restarted in Beijing commercial negotiation, in what looks like the first round between the parties after the 90-day truce signed on December 20 by Presidents Donald Trump and Xi Jinping, on the sidelines of the GXNUMX in Buenos Aires. The two superpowers will confront the aim of curbing the escalation of trade tensions which led to round billions of duties, fibrillation on price lists and an insidious woe of the Chinese economy.
Trump spoke of "great progress" and Beijing's willingness to reach an agreement, while Xi mentioned "collaboration" between the two countries as the only possible option. Times are limited: the truce that has been called will expire at the end of March Stand by for 90 days on the extra tariffs threatened by Donald Trump on products made in China for a value of 200 billion dollars. If there are no unforeseen events today, a further meeting for negotiations in Washington in about ten days. There is much anticipation for the outcome.
Elon Musk, meanwhile, has given the kick-off – with the Chinese authorities – to work on the construction of the new factory, work is starting with the aim of selling cars directly to Chinese consumers and avoiding the tariffs of the trade war between the two superpowers. The aim is to achieve the largest foreign investment for Tesla: the eventual annual production of 500.000 vehicles of the Chinese factory would drastically increase the production of the US giant and would allow direct access to the largest electric vehicle market in the world.
“I can't wait to break ground for the @Tesla Shanghai Gigafactory today!” Musk tweeted. The work has begun with the aim of completing the construction of the factory by this summer.
Tesla CEO @elonmusk with Shanghai Mayor Ying Yong at Tesla Shanghai Gigafactory ground breaking ceremony. $ TSLA #Tesla #China #TeslaChina # GF3 pic.twitter.com/sIecnGsU71
— Vincent (@vincent13031925) 7 January 2019
Musk personally went to Shanghai to inaugurate the start of work with the Chinese authorities. Jobs that would cost the beauty of 5 billion dollars. Musk said: “The Shanghai plant will supply Greater China with affordable versions of Tesla's Model 3 – the first mid-priced vehicle just launched right on the Chinese market – with the smallest model Y already planned". In contrast, the expensive Model S and X will continue to be made in the United States for the global market.
It is not yet known how much the Tesla will cost for the Chinese market but without a doubt, much less than the current Model 3. The next Tesla Y thanks also to the Chinese factory will be positioned much lower than imagined. Will become a real competitor for the Nissan Leaf and for the Renault Zoe, electric cars to date very far from the reach of his majesty Tesla. Now the challenge is global and the US brand enters a market sector that was unimaginable until recently.
It's reaching a tipping point, leaving Tesla aside, just last week there Apple Lossless Audio CODEC (ALAC), has raised global alarm over the prospects of the world's second largest economy, due to slowing demand in China and the trade war looming.
Tesla's production line outside the United States risks being a tipping point for the entire industry because China requires all companies to create joint ventures with domestic firms when establishing production facilities, which it involves sharing profits and technology with local partners. If Tesla, the very symbol of Made in the USA, lowers his head, it means that the revolution is upon us.
