Tesla signs deal to build new factory in China

Tesla has reached an agreement with the Shanghai government to build a new factory. This news follows initial talks between the automaker and Shanghai officials, which began in June. According to the report, Tesla will own the new factory rather than merge with a local manufacturer. This marks the first time a foreign automaker has fully owned its production facilities in China, although Tesla will still be subject to a 25 percent import tariff.

China is currently the world’s largest electric vehicle market and is projected to grow rapidly in the near future. The Chinese government has stated that it aims to increase electric vehicle sales to 7 million units by 2025. Back in September, the government ordered all automakers in the country to begin building electric vehicles by 2019.