Published: Thu, May 17, 2018
Money | By Armando Alvarado

Tesla Registers Company in Shanghai

Tesla Registers Company in Shanghai

The U.S. carmaker has been in protracted negotiations to set up its own plant in Shanghai to produce vehicles locally, helping bolster its position in the country's fast-growing market for electric cars and to avoid high import tariffs.

As per the Reuters report, citing a filing with the National Enterprise Credit Information Publicity System, the new electric auto company has been registered by Tesla in south-east Shanghai within the free-trade zone area of the city.

Additionally, the vehicle maker will then be able to avoid the high import tariffs that China imposes - especially on United States made cars. Ltd., which is listed as the sole shareholder of the new Shanghai-flagged corporation.

Tesla Inc (TSLA.O) has registered a new electric auto firm in Shanghai, as China prepares to scrap rules on capping foreign ownership of new-energy vehicle (NEV) ventures.

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Called Tesla (Shanghai) Co Ltd, the firm will focus on electric cars, spare parts and batteries, as well as the development of photovoltaic products.

China recently announced that foreign companies can operate 100 per cent-owned factories in the country, making the market a particularly tantalizing destination for Tesla. There was no formal announcement by Tesla, which has declined to comment.

Tesla's aspirations to build a factory in China has been well-known. Current rules capped foreign ownership at 50%, requiring Tesla to enter into a 50/50 joint venture with a Chinese partner-something Tesla CEO Elon Musk was unwilling to do as it looks to tap into the world's largest EV market. Now, Tesla has announced that it would unveil the location of its own Gigafactory in China.

The Palo Alto, California-based company has been working with Shanghai's government since a year ago to explore assembling cars in China.

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