Tesla to build a new factory in Shanghai for its Megapack battery - PingWest

Tesla to build a new factory in Shanghai for its Megapack battery

Tesla to build a new factory in Shanghai for its Megapack battery

10 hours ago

Tesla on Sunday announced that it would build a new mega factory in Shanghai, which will be dedicated to manufacturing the company's energy-storage product Megapack, Xinhua News Agency reported.

The factory, to be located in the Lin-gang Special Area of China (Shanghai) Pilot Free Trade Zone, is scheduled to commence construction in the third quarter of 2023 and start production in the second quarter of 2024.

Initially, the factory will produce 10,000 Megapack units per year, equivalent to about 40 GWh of energy storage, and the products will be sold globally.

Developed by Tesla, Megapack is a powerful battery system that is designed to provide energy storage and support to the electrical grid, helping to stabilize the grid and prevent outages. According to information provided by Tesla, each Megapack has a capacity of up to 3 megawatt hours (MWh), making it capable of powering around three thousand homes for one hour.

The product is an important part of Tesla's push toward sustainable energy solutions, as it can be an efficient alternative to traditional fossil fuel power plants, and is well-suited for storing renewable energy sources like wind and solar power. 

Tesla's energy storage business, although a smaller part of the company's overall business, is experiencing rapid growth. In Q4, the company deployed a record-breaking 2.4 GWh of energy storage, marking a 152% increase from the same period in 2021 and 300 MW more than the previous quarter. In addition, during the quarter, the energy storage business generated over $1 billion in revenue for the first time.

It is worth noting that Tesla Megapack orders are currently backed up to early 2025, representing a 2-year backlog. To address the rising demand for energy storage solutions worldwide, the giant has been ramping up production in Lathrop Megafactory since Q4.

By leveraging China's leading battery supply chain through its new Shanghai plant, the company could significantly increase Megapack output while reducing costs.

According to Lu Yu, an official of the Lin-gang Special Area Administration, Tesla's new Megafactory is anticipated to create an industrial cluster worth more than 100 billion yuan ($14.55 billion).

SHARE