Tesla to build a second Megafactory for utility-scale energy storage units in Shanghai

Tesla will build its next Megafactory—the company’s utility-scale battery factory—in Shanghai; the plant will be capable of producing 10,000 Megapacks per year, equal to approximately 40 GWh of energy storage. Tesla’s original Megapack factory is in Lathrop, California, also with a 10,000 Megapack per year capacity.

Megapack systems are customizable and scalable, making them suitable for projects of various sizes and locations. Each Megapack unit battery module is paired with its own inverter for improved efficiency and increased safety.

Xinhua reported that Tesla will break ground on the plant in Q3 and start production in Q2 2024. The Megafactory will complement Tesla’s Gigafactory Shanghai, which produces the Model 3 / Model Y.

(Tesla has an operating lease arrangement for an initial term of 50 years with the local government of Shanghai for land use rights for Gigafactory Shanghai. Under the terms of the arrangement, Tesla is required to spend RMB 14.08 billion (US$2 billion) in capital expenditures by the end of 2023 and to generate RMB 2.23 billion (US$325 million) of annual tax revenues starting at the end of 2023. Should Tesla be unwilling or unable to meet such targets or obtain periodic project approvals, in accordance with the Chinese government’s standard terms for such arrangements, Tesla would be required to revert the site to the local government and receive compensation for the remaining value of the land lease, buildings and fixtures.)