TESLA yesterday started production at its Shanghai battery megafactory, dedicated to manufacturing its high-capacity Megapack energy storage systems, Xinhua reported.

The facility, first announced in April 2023, marks Tesla’s continued expansion in China, the world’s largest electric vehicle and energy storage market. Located in Shanghai’s Lingang Free Trade Zone, the plant aims to bolster global energy storage capacity by producing 10,000 Megapacks annually, equivalent to 40 GWh of energy storage. These lithium-ion battery units are designed for large-scale commercial and utility projects, helping stabilize power grids and support renewable energy integration.

Tesla’s Shanghai factory is the company’s first dedicated energy storage plant outside the United States, complementing its California-based Megafactory. By leveraging China’s advanced supply chain and manufacturing efficiencies, Tesla aims to reduce production costs and accelerate deployment worldwide. The move also aligns with China’s push for clean energy and energy storage solutions to enhance grid stability and reduce reliance on fossil fuels.

The Megapack has gained significant traction as businesses and utilities seek scalable storage solutions for renewable energy projects. Tesla’s energy division has seen growing demand, contributing to the company’s broader strategy of expanding beyond electric vehicles into the sustainable energy sector.

Tesla’s investment in China underscores its long-term commitment to the region, where it also operates Gigafactory Shanghai, the company’s largest electric car production hub.

A State Council executive meeting held Monday reiterated foreign firms’ role in creating jobs, stabilizing exports and fostering industrial upgrades. The meeting approved an action plan to expand support to reinvestment and equity investment by foreign firms in China.

German optics giant Zeiss said Feb. 6 it will build a new headquarters campus in Shanghai, with a total infrastructure investment of over 600 million yuan (US$82.8 million). Toyota Motor Corp also announced a day earlier that it will establish a new wholly owned company in Shanghai’s Jinshan District to develop and produce electric cars and batteries. (SD-Agencies)