American electric vehicle company Tesla is planning to invest $188 million to expand its gigafactory in Shanghai. The investment is meant to increase the facility's production capacity to keep up with the demand for its vehicles in China and in Asia.
State-backed media company Beijing Daily reported that the expansion should create more than 4,000 new jobs at Tesla's Shanghai factory. The newspaper cited a filing with a Shanghai government platform as the source of its information.
The filing indicated that the expansion plan would require the hiring of 4,000 additional staff members, bringing the total workers in the factory to more than 19,000. The filing cited that there will be no new models that will be built at the factory. It also did not mention how much production capacity would be increased with the substantial investment.
Construction on the project is set to begin in December and be completed in April 2022. A review of the project's carbon track and carbon emissions has reportedly been completed. The new expansion project will be carried out in the factory's production zones.
Tesla plans to use the bulk of the investment to optimize the production lines of the gigafactory in Shanghai, while around $13 million will be used towards environmental preservation projects related to the expansion.
Tesla's Shanghai plant was built to generate up to 500,000 cars per year, and it presently has the potential to create 450,000 combined Model 3 and Model Y vehicles per year.
Even as regulatory pressure mounts due to customer complaints about product safety and examination of how the company handles data, the automaker's sales in China are still soaring. Tesla previously said that to appease regulatory concerns, it would be creating a research facility in Shanghai as well as a separate data center to store data locally.
The company completed the construction of the research and development and innovation center in Shanghai last month. Analysts said that Tesla's decision to comply with regulatory demands demonstrates its optimistic approach towards one of its largest markets.
Telsa currently ships Model 3s built in China to Europe, while it is still constructing a facility in Germany. According to figures from the China Passenger Car Association, it sold 54,391 China-made automobiles in October, including 40,666 for export.
Tesla owns the Shanghai facility outright, making it the first and only foreign passenger vehicle plant in China not run by a joint venture.
