Tesla Model 2
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Tesla To Start Building New Model 2 Factory In Shanghai After Chinese Government Approval

Tesla has gotten approval to expand and add a new plant to the Shanghai gigafactory. The new plant will be producing a China designed new vehicle expected to be the Model 2.

Tesla has gotten approval from the Shanghai government to add manufacturing capacity to current plants producing the Model 3/Y and build an adjacent plant to manufacture a whole new China designed vehicle. The regulatory hurdle Tesla cleared is an initial environmental impact assessment.

In the filing, Tesla divides the project into phases 1 and 2. For phase 1 Tesla is trying to increase the production capacity of vehicles already being built in Giga Shanghai. In addition, Tesla is also planning to start manufacturing parts associated with the drive unit like the motors and also assembling the seats in Giga Shanghai. These parts for the Model 3 and Y have been getting built in the US and delivered to Giga Shanghai.

As Tesla increases its manufacturing capacity in Shanghai, building more components of the vehicles in the same plant was expect. But what is not expected or at least has come sooner than expected is, Tesla’s filing to build a plant for a new vehicle designed in China.

Related news: New Model S & X Interior Blueprint - Elon Musk And Tesla’s Elegant First Principles Ethos

Since the new vehicle Tesla is trying to build is under development, Tesla has said it will use some portion of the current plant for new the model’s early start-up related test and research work. These tests include the test of important equipment and production processes, and product size verification, matching of parts and functions.

Tesla Model 3

The test cycle of the project is about 6 months. And after the construction of the new plat, production will begin. We have some information about what the new vehicle will be. Elon Musk in the past has alluded to a 25,000 dollars compact car to be designed manufactured in China.

Tesla China in its official Weibo account released a rendering of a small vehicle to be designed in China. The vehicle resembles the model 3 from the front but has a hatchback and seems much smaller.

Elon Musk while presenting Tesla’s Battery Day event has said the new 25,000 vehicles (unofficially called the Model 2 among Tesla enthusiasts) will be the primary vehicle for autonomous ride-hailing purposes.

Other information we got on the event, the vehicle will have lithium-iron-phosphate (LFP) batteries. Tesla currently uses LFP batteries it sourced from CATL to power its China-made Model 3s. LFP when compared to nickel and nickel-manganese batteries has less energy density.

However, iron, unlike nickel has ample worldwide supply. This will ensure, what will probably be Tesla’s highest volume selling the vehicle will not face battery shortages caused by the raw material shortage.

The Model 2 is expected to have around 300 miles range. And be able to carry 4 adults. And will probably be the smallest and cheapest vehicle Tesla will be designing for a while.

So what do you think? Are you excited about Tesla’s 25,000 dollar vehicle? How soon after starting the plant do you think will Tesla start deliveries of the vehicle? Let me know your thoughts down in the comments below.

For more information check out: Elon Musk Interview With Sandy Munro - New Li-ion 12v Battery In The Model S & X And More Also, see Updated Tesla Semi Seen Without Wraparound Windshield - One Cause Of Nikola Patent Lawsuit

Tinsae Aregay has been following Tesla and The evolution of the EV space on a daily basis for several years. He covers everything about Tesla from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at
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