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Tesla shuts down another rumor of finalized plans to build a Gigafactory in China

Tesla CEO Elon Musk and other company officials have talked about building a Gigafactory to manufacture batteries and electric vehicles in China for the past 3 years and while they have been several reports of finalized plans, they have all been shut down.

A new one came this week after a report in the Southern Metropolis Daily, citing multiple sources, claimed that Tesla had struck a deal to build a factory without a joint-venture in China’s Guangdong province. The company denied the report, but without necessarily denying that a factory is coming to China.

A company spokesperson simply shut down the rumor of a plant in Guangdong (via CNBC):

“Tesla is deeply committed to the Chinese market, however the rumors that we plan to open a factory in Guangdong are not true,”

Last year, reports suggested that Tesla executives visited locations in the Suzhou region and talked to potential manufacturing partners. And earlier in 2016, Musk confirmed that the automaker plans on securing a location and a local partner for a manufacturing facility in China by the middle of 2016, but an announcement never came.

It might have something to do with the government relaxing its domestic production policies when it comes to electric vehicles around the same time. In order to accelerate the production of electric cars in the country, the government said that it was willing to lift the obligatory joint-venture with a domestic company, which would open the door for Tesla to establish local manufacturing capacity and changed the company’s earlier plans.

Tesla has since announced plans for 2 to 3 more planned Gigafactories with locations to be announced by the end of the year.

Based on comments by Musk, we speculated that the Gigafactories are likely to be in Europe and China with possibly another one in the US if they decide to go with 3 additional factories.

For future plants, Tesla expressed intentions to build in both battery production and electric vehicle assembly, which could make those factories possibly more “giga” than the Gigafactory 1 in Nevada.

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