Hit by trade war, Tesla opens bid process to build China Gigafactory
- At least one contractor has started preparing materials for the plant’s foundations, according to a document on its website
- US$2 billion factory will be electric vehicle maker’s first in China – and the first wholly foreign-owned car plant in the country
Tesla has opened a tender process to build its Shanghai Gigafactory and at least one contractor has started buying materials, according to sources and documents reviewed by Reuters, the clearest indication that construction is imminent.
The details, previously unreported, reveal that state-owned Shanghai Construction Group is taking part in the bidding while a unit of China Minmetals Corp is preparing materials for the plant’s foundations.
The US$2 billion factory, Tesla’s first in China, is a major bet for the US electric vehicle (EV) maker as it looks to bolster its presence in the world’s biggest car market where its earnings have been hit by increased tariffs on US imports.
The so-called Gigafactory would also be China’s first wholly foreign-owned car plant, whose progress is widely seen as a reflection of Sino-US relations and also the degree to which China is opening up its markets.
Tesla, led by billionaire chief executive Elon Musk, has begun seeking bids from companies looking to build the plant, according to two people with knowledge of the matter and a construction document on an official local bidding platform.
Shanghai Construction Group is among several firms bidding, the two people said, declining to be identified because the information was not public.
Shanghai Baoye Group, a China Minmetals subsidiary, is preparing for the delivery of a large amount of concrete pipe piles and steel pile tips in the second half of December, according to a document on the metals giant’s website.