Tesla's second factory in Shanghai is ready in record time

The new factory is located next to Tesla's existing gigafactory and marks the company's first energy storage facility outside the US

By: Eleonora Lilli

Jan 2, 2025 at 5:05am ET

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Less than a year after construction began, the new mega-factory in Shanghai dedicated to the production of Megapack energy storage batteries is complete and operational. Mass production is expected to reach full capacity in the first quarter of 2025.

The construction of the plant, which is located next to Tesla's existing vehicle gigafactory in the Lingang area and marks the company's first energy storage plant outside the US, set a new 'speed' record, as it took even less time than Tesla's first Shanghai plant to come on stream.

What it produces

Tesla's second factory in China, which covers 200,000 square metres and represents an investment of about 1.45 billion yuan ($202 million), will mainly produce Megapacks for the domestic and export markets. Specifically, the plant can assemble 10,000 Megapack units per year, equivalent to about 40 GWh of energy storage capacity.

According to Tesla, each Megapack can store more than 3 MWh of energy, enough to power about 3,600 homes for one hour. The Megapacks will use lithium iron phosphate (LFP) batteries.

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New agreement with BYD

Tesla has signed its first Megapack orders with the Shanghai Lingang Economic Development Group. The main supplier of Megapack battery cells is CATL (80 per cent), but the company has partnered with FinDreams, a battery manufacturing unit of BYD, to supply battery cells for the Megapacks starting in the first quarter of 2025.

The Chinese Megafactory, we recall, complements the one already in operation at Lathorp, California. The American plant will also reach an annual production of 40 GWh once it is at full capacity.