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Tesla is talking with the Shanghai municipal government to set up a factory in the region and expects to agree on a plan by the end of the year. China’s government has considered allowing foreign automakers to set up wholly owned factories in free trade zones in part to encourage more production of electric and hybrid vehicles. Tesla would still have to pay a 25 percent duty on cars built in a free trade zone, but it could lower its production costs.
The Wall Street Journal reported that Tesla and the Shanghai government have already reached a deal in that city’s free trade zone. Shanghai is China’s de facto automotive capital and a significant market for luxury vehicles of all kinds. Chinese internet company Tencent Holdings has a five percent stake in Tesla and is seen as a potential ally for Tesla’s efforts to enter the Chinese market.
The Wall Street Journal reported that Tesla and the Shanghai government have already reached a deal in that city’s free trade zone. Shanghai is China’s de facto automotive capital and a significant market for luxury vehicles of all kinds. Chinese internet company Tencent Holdings has a five percent stake in Tesla and is seen as a potential ally for Tesla’s efforts to enter the Chinese market.