Tesla Registers New Business In China

Tesla Registers New Business In China

As per Electrek, the scope of the new company's business includes the basic wholesale, import-export, and electric vehicle display, but also is registered for technology development and transfer. Tesla declined to comment on the registration.

Additionally, the auto maker will then be able to avoid the high import tariffs that China imposes - especially on USA made cars.

Tesla could be on the verge of announcing a Gigafactory in China after registering a new company in Shanghai's Free-Trade Zone.

USA media reports have speculated the Shanghai registration is a response to China's willingness to ease its foreign ownership restrictions for automotive factories. Zhu Xiaotong, who is the head of Tesla's Chinese operations, is listed as the new firm's legal representative, with Tesla Motors HK Limited given as its only shareholder.

According to the source, the new company will kick off business with a capital of 100 million yuan, or almost $16 million. "Tesla is still inarguably the leader in electric cars, and its locally-built cars will attract more buyers". They also said that all automotive restrictions in terms of foreign ownership would be done away with by 2020. The foreign ownership rule change in China marks a major policy shift by the country which had capped foreign ownership at 50% for the last two decades.

Tesla has long fought to maintain complete control of its own plants and protect its in-house technology.

Now, with China promising to loosen its hold on the vehicle market, the biggest gains will be seen by NEV ventures such as Tesla's. Tesla CEO Elon Musk had earlier said that the company will be setting up its next manufacturing facility in China.

Last year, China rolled out a plan to eliminate internal combustion engines in cars by 2040.