China has helped Tesla grow fast in recent years. In turn, Tesla has put in large investments into the auto sector.
Now, Tesla has plans to launch another Model 3 that suits the Chinese market. The company aims to produce at least 3,000 units of Model 3 per week in its Chinese Gigafactory. The factory at Shanghai is already under construction from January. Revenue from the Chinese market has touched $1.8 billion which is almost 8 percent of the company’s total revenue.
The target production levels will be achieved by the company between this year’s fourth quarter and next quarter’s second quarter.
Tesla intends to provide Model 3 version vehicles at affordable rates to the local people in China, says the company in the letter to its shareholders.
A special announcement is to be made by Tesla this week, by which plans to launch vehicles with specifications that cater to the local market will be unveiled.
Producing vehicles in the local market will help in the reduction of manufacturing costs, says Tesla. Chinese import tariffs will be avoided, by which Tesla can quote competitive prices for its vehicles.
The automotive landscape has taken a transformation with vehicles from Tesla. Model 3 has become a top-selling automobile vehicle. Unless vehicles are made at top production levels, they cannot build up profits. With many EV in the market, it needs to keep up with the competition to stay in the market.
Tesla is selling its Model-3 vehicles within the price range of 300,000 yuan to 350,000 yuan before subsidies are made. Model 3 cars are already sold in China, by importing them from the U.S. These imported vehicles are sold at 377,000 yuan as they include import duties and taxes. With the Shanghai factory, the company hopes to bring down prices, as duties and value-added-taxes will be excluded from costs.