Giga Shanghai: Tesla's Chinese Factory Continues To Grow Unstoppable, On Track To Become Largest Car Factory In The World

The Tesla Gigafactory in Shanghai (China) broke all its previous records this last November: Tesla announced that it manufactured more than 100,000 cars last November at its Chinese factory, which is an amazing 40% more than the previous month, October.

This impressive output number puts Tesla’s Gigafactory in Shanghai on track to become the world’s largest car factory in the world, sponsored and spearheaded by Tesla, a company that has become a symbol of technological innovation and green energy. The factory opened back in 2018, but production had to be halted in February 2021 due to the deadly COVID-19 pandemic. However, it was able to re-open in March of the same year and since then, production has continued Growing steadily.

On the other hand, in Europe the Giga Factory Berlin continues to give Tesla some headaches and Giga Texas in Austin is still somehow warming up, still very far from its maximum production capacity. But China's Gigafactory is Tesla's cash cow: the Shanghai factory was built in record time, and quickly ramped up its production pace, even speeding up production as time passes by.

Last November Tesla delivered 100,291 electric vehicles made in China, the highest monthly sales figure since its Shanghai factory opened its doors, at the end of 2020. This figure represents an outstanding 40% increase as compared to October this year, and 89.7 % more than in November last year.

With such production capacity, Tesla's Gigafactory in Shanghai is on its way to becoming one of the largest car factories in the world (that is, including legacy ICE vehicles), and may even become the largest overall. Considering this milestone achieved in November, the Chinese factory could soon exceed 1.2 million units per year. This would immediately make it the second largest car factory in the world, right away, behind only the Hyundai complex in Ulsan, South Korea, which makes around 1.5 million vehicles each year.

However, not everything is actually positive: according to Bloomberg, Tesla plans to reduce production of the Model Y at the Shanghai plant by 20% in December as compared to last November's figures, according to sources close to the company. At the moment the reason why Tesla would have decided this production cut is largely unknown, and the company has not made any statements in this regard either.

There are some possible indications as to know the reasons for this cut, though. Last October, Tesla increased its inventory in Shanghai at the fastest pace in its history, according to data from China Merchants Bank International (CMBI). Demand has basically slowed down a little bit, and Elon Musk himself said earlier that month that China is in a "sort of recession". Still, Tesla's sales in China - its biggest global market - nearly doubled in November from a year earlier, fueled in part by Tesla's price cuts on the Model 3 and Model Y.

Tesla Giga Shanghai sets new record by selling over 100k vehicles in Novemberhttps://t.co/ZK548Ldqvj by @ResidentSponge— TESLARATI (@Teslarati) December 5, 2022

Nevertheless, with the Shanghai factory on its way to becoming the biggest car factory in the world - competing with some of the largest legacy ICE suppliers such as Hyundai and Volkswagen - Tesla continues to demonstrate its leadership in the global electric car market.

All images courtesy of Tesla Inc.

Nico Caballero is the VP of Finance of Cogency Power, specializing in solar energy. He also holds a Diploma in Electric Cars from Delft University of Technology in the Netherlands, and enjoys doing research about Tesla and EV batteries. He can be reached at @NicoTorqueNews on Twitter. Nico covers Tesla and electric vehicle latest happenings at Torque News.