(Bloomberg) -- Tesla Inc. has set up a new wholly owned company in Shanghai, moving a step closer to producing its electric vehicles in China and establishing its first gigafactory outside U.S. shores.
Tesla's Hong Kong division registered the new company with a capital of 100 million yuan ($15.8 million), the National Enterprise Credit Information Publicity System said on its website. The business scope of the unit includes technological development and services on electric vehicles, auto parts, batteries, energy storage facilities and solar panel products, according to the website.
A representative for Tesla China wasn't able to comment immediately.
The Palo Alto, California-based company has been working with Shanghai's government since last year to explore assembling cars in China. Last month's announcement by Beijing that it will allow foreign new-energy vehicle makers to fully own auto factories as early as this year removed the primary hurdle in the way of founder and billionaire Elon Musk. The change in policy also came in the midst of a raging trade spat between the U.S. and the world's second-biggest economy.
China Hands Olive Branch to Tesla as Tie-Up Rules Wind Down
In an earnings call earlier this month, Musk told investors that Tesla plans to announce the location of a gigafactory in China as early as in the third quarter of this year. Previously, he had said his company will probably make the Model 3 sedan and Model Y crossover in China and won't build the pricier Model S and Model X there.
To contact Bloomberg News staff for this story: Yan Zhang in Beijing at yzhang1044@bloomberg.net.
To contact the editors responsible for this story: Sam Nagarajan at samnagarajan@bloomberg.net, Ville Heiskanen
©2018 Bloomberg L.P.
With assistance from Yan Zhang
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
