Tesla to Deliver the First China-made Model 3s on Dec. 30

author: Eric Walz   

A worker stands watch outside the Tesla gigafactory in Shanghai, China on December 2, 2019. (Photo: Aly Song/Reuters)

Less than twelve months after construction began, electric automaker Tesla will deliver the first Model 3 sedans built at the company's new Shanghai gigafactory.

Tesla announced that the first Model 3's made in China will be delivered to customers on Monday, Dec 30. The first test pre-production Model 3's were built at the new factory in October, the first steps before Tesla begins to ramp up production.

The first 15 customers to get the cars on Dec 30 are Tesla employees, the company representative said to Reuters.

The Shanghai facility is Tesla's first assembly plant outside of the U.S. and the Model 3s are the first-ever electric vehicles built outside of the U.S. Currently, Tesla ships all of its vehicles from its factory in Fremont, California.

The California-based company is also the first foreign automaker to wholly own a factory in China, after the Chinese government relaxed rules restricting automakers from owning no more than 50% of any joint venture with a Chinese partner.

The Chinese government has also been supportive of the factory. Tesla received favorable loans from Chinese lenders to build its new plant, just outside of Shanghai. Last week, Tesla secured a $10 billion yuan ($1.4 billion) five-year loan facility for construction and other expenses.

Tesla's new Shanghai factory is helping the automaker enter China's auto market, which is the world's biggest. By building vehicles in China, Tesla will avoid steep import tariffs imposed on its U.S.-built vehicles, allowing the company to sell its vehicles at a lower price and remain more competitive from rivals.

The China-made cars are priced at 355,800 yuan ($50,000) before subsidies and Tesla has said it wants to start deliveries before Chinese new year beginning on Jan. 25. 

The Ministry of Industry and Information Technology said previously it had added Tesla's China-made Model 3 to a list of new energy vehicles exempt from China's 10% purchase tax.

Tesla first signed a deal with Shanghai authorities in July 2018 to build the Shanghai gigafactory United States, saying it would cost around $2 billion to construct. The factory doubles the size of Tesla's global manufacturing.

Tesla is targeting a production rate of 250,000 vehicles a year, once the upcoming Model Y crossover is added to the production line.

Tesla began taking deposits of 8,000 yuan ($1,153) from Chinese customers in Nov 2018, as site preparations began just ahead of construction of the Shanghai factory.

Eric Walz

Originally hailing from New Jersey, Eric is a automotive & technology reporter covering the high-tech industry here in Silicon Valley. He has over 15 years of automotive experience and a bachelors degree in computer science. These skills, combined with technical writing and news reporting, allows him to fully understand and identify new and innovative technologies in the auto industry and beyond. He has worked at Uber on self-driving cars and as a technical writer, helping people to understand and work with technology.