Tesla Motors

Tesla establishes an electric vehicle manufacturing plant in China. Following its announcement on Thursday, Tesla revealed that it was holding talks with the Shanghai Municipal government. The 25% on imported vehicles in China, made Tesla to have an idea of building electric cars. The company clearly said that it has many expectations on defining the production plans in China, despite the fact that it did not give out a proper timeline for setting up the plant.

On Thursday trading, Tesla shares at $382.61 closed up at 1.7%. Foreign companies such as Tesla are needed by the central government of China for the purpose of forming a strong partnership in the emerging and new auto manufacturing technologies so as to develop the industry. However, the foreign company should owe no more than 50%.

Tesla itself did never reveal exactly the company it was going to partner with, resulting in a variety of online speculations, leaving people and companies in the unsteady state, wondering on its next move. More than three companies said openly that they were not in any collaboration with Tesla but looks up to media reports extracting implications from them. The said companies include; Shanghai Electric Group Co (601727. SS), Shanghai Lingang Holdings Co (600848. SS) and Tianjin Motor Dies Co (002510 .SZ).

More speculations are eyed on Tencent Holdings Ltd (0700.HK) which is the largest internet company in China. It is revealed that Tencent Holdings obtained a stake of 5% for $1.8 billion in Tesla. Up to date, Tesla company remains undecided on the kind of vehicle it is going to build in China. Although a particular supplier who appears to be familiar with Tesla gave out a hint that the company was thinking of building Model 3 sedan and crossover companion known as Model Y. This model 3 is slated to start production as early as July in California where the plant commonly known as Tesla Fremont plant is located. Model Y is likely to follow in mid-2019.

Lighthizer informed the US lawmakers that the administrators should take actions just in case it happens for reasons which prove to be non-economical or appears to give out no good profit at all. Tesla is considered as the most valuable and important automaker in U.S, having a greater market all over. A market capitalization of billions amounting to $60 billion. Tesla is still expected to give out an annual profit which is yet to be released.


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