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Tesla to seek local investors for new plant in China

Tesla is seeking Chinese partners to help fund a $5bn (?3.8bn) factory it plans to build in the country as the electric car company hopes to grab a bigger slice of the world’s largest market for battery vehicles.
The company’s second plant, slated for Shanghai, is eventually intended to be able to produce 500,000 cars a year.
Once open it would help Tesla get round import tariffs which the US looks likely to impose on foreign built vehicles, a move which would almost certainly trigger retaliatory measures.
According to Bloomberg reports, Tesla founder Elon Musk wants to bring in Chinese investors to ease financial pressure on the company which is burning through cash as it seeks to increase production rates, particularly of its mass-market Model 3 car.
Tesla has previously said it has enough resources to finance its plans. However, analysts believe the company – which had $2.7bn in cash at the end of the first quarter – will need to raise money to see them through.
Tesla to seek local investors for new plant in China

Tesla is planning a second car plant which will be built in Shanghai

Credit:
Jasper Juinen/Bloomberg
On Wednesday evening Tesla will release interim numbers which are expected to show progress on its production rate. Last month the company said that, after an intense push – which included building vehicles in a giant tent set up in the car park of the California factory – it had reached its target of building 5,000 Model 3’s a week.
When production of the Model 3 began last summer Mr Musk said the company would be making 5,000 of them a week by December and 10,000 a week at some point in 2018.
Tesla Model 3 puff
The recent delivery report for the second quarter revealed that Tesla handed over 53,339 cars of which 28,578 were Model 3s.
Wednesday’s second-quarter numbers after US markets close are expected to show a loss of $2.71 per share, more than twice the loss in the same period a year, on revenues more than $1bn higher at $3.96bn.
The wider losses are expected to have been largely driven by the intense production ramp up.
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