Musk on Why Tesla Insisted on a Sole-Ownership Factory in Shanghai: Years of Talks with Chinese Officials to Secure a Plant That Could Accelerate Industrial Innovation
At the Barron's Investment Conference, Musk revisited Tesla's Shanghai factory negotiations, noting some initially demanded a joint venture. Tesla spent years securing a wholly-owned facility, insisting on sole ownership for faster decisions and innovation. After China lifted foreign equity restrictions on new energy vehicle manufacturing in 2018, Tesla built its first overseas Gigafactory in Shanghai's Lingang area.
Musk on Why Tesla Insisted on a Sole-Ownership Factory in Shanghai: It Took Years of Negotiations with Chinese Officials to Secure the Right to Build a Factory Independently to Accelerate Industrial Innovation
Tesla CEO Elon Musk recently revisited the negotiations for building a factory in Shanghai at the Barron's Investment Conference. He said that at the time, some parties had asked Tesla to form a joint venture with a Chinese company. Tesla, however, spent several years communicating with Chinese officials to secure the right to build a factory with sole ownership. Musk explained that he insisted on sole ownership to enable the company to make decisions more quickly. If every adjustment required prior approval from a partner, it would be difficult to advance innovation at a fast pace.
In 2018, China lifted restrictions on foreign equity ratios for the manufacturing of new energy vehicle assemblies. Tesla subsequently built its first overseas Gigafactory in Shanghai's Lingang area. The factory began producing the Model 3 at the end of 2019 and started producing the Model Y at the end of the following year. Speaking about the Chinese market, Musk said the Model Y is the best-selling electric vehicle in China. He also noted that Chinese automakers are very strong, and it was not easy for Tesla to achieve this success amidst such competition.
Source: https://cn.technode.com/post/2026-11-09/elon-musk-tesla-shanghai-factory-full-ownership/