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Tesla To Start Exporting Made-in-China Model 3 To Europe, Why The Export From China Is Significant

An Italian Tesla customer with the Twitter handle “Ma_io_che_ne_so” uploaded their Model 3 invoice on the 18th of October. The receipt looks ordinary if you glide through the details. However, there is something special about the invoice. Under the inventory category, it boldly says CHINA.

Tesla To Start Exporting Made-in-China Model 3 To Europe

One can’t make assumptions on a tweet because they may or may not be legitimate. The speculations gathered legs when another invoice this time from a French customer surfaced online and was uploaded by an outlet named Green Drive.  The Tesla Model 3 deposit invoice shows the description of the vehicle reserved as “Model 3 – China”, and with a VIN starting with LRW, and LC designating the year (L = 2020) and the country of manufacture (C = China).

Tesla Model 3 Exports from China

This was not the last invoice to go viral. Another tweet from Armand Vervaeck, a Belgian Tesla owner who realized that a German VIN allocation also beginning with LRW had come across his radar. He uploaded the photo of the invoice in question.


Why the export from China to Europe is significant?

Tesla announced the Giga Shanghai back in 2018. Back then it was the third Giga Factory and first outside the USA.

“We expect construction to begin in the near future after we get all the necessary approvals and permits,” the company said in a statement. “From there, it will take roughly two years until we start producing vehicles and then another two to three years before the factory is fully ramped up to produce around 500,000 vehicles per year for Chinese customers.”

Through a Twitter thread, Elon Musk conveyed the message that higher-end Model 3 and Model Y vehicles for the Chinese market would still be produced in the US, and the Chinese factory would only produce “affordable versions” of the Model 3 and Model Y for local demand in greater China

All indications were that Tesla had built the Giga factory in Shanghai to increase the production of Tesla Model 3 in China to meet the local demands and nothing more. The numbers backed Tesla’s urge to have a factory in China.

China best selling new energy vehicles in July

From the above data, it is clear how in demand the Tesla is in China itself.  Initially, the exports were handled by Tesla’s main factory located in California. The U.S. automaker, which started delivering Model 3 electric sedans from its Shanghai factory in December, also plans from next year to sell China-made Model 3 vehicles to Japan and Hong Kong To manufacture and sell Tesla Models 3s in China could reduce the delivery time massively and meet the demand. Companies like NIO and Xpeng are currently leading in manufacturing of Electric Vehicles in China, one of the motives for Tesla to move manufacturing to China could also be to stay ahead of these local companies.

The U-turn

In September, we reported that the Model 3s manufactured at the Giga Factory in Shanghai will make their way to the European markets. Completely contradicting to what Musk had said over a year ago.  These reports took into account the glaring gap in the sales of the automobile companies already established in Europe for example, Volkswagen, Renault, Daimler, etc. and Tesla. The obvious reason for this disparity in sales is the lack of a production house in Europe. Elon Musk and Tesla had a plan for this. The Giga Berlin in the future is the key to massive penetration in the European market and also to reduce this gap and hopefully overtake in the future.

This objective would only be achieved earlier if the Tesla Models manufactured in China would also make their way in Europe. It was only logical to deduce this possibility. A month on from this report it seems that deliveries to European customers have begun. Tesla recently announced the refreshed Model 3 2021. The delivery deadlines for the Model 3 were pushed further by Tesla. Naturally, everyone expected it because of the various features that were being offered with the new Model 3. But there seems to be another reason for this delay. That is the car being delivered from Shanghai.

The interesting bit is that some months ago we reported that Model 3 Standard Range Plus will undergo a cost cut in China. The price of Model 3 SR was 271,550 Yuan (40,000 USD), but after the price cuts, it will cost 249,900 Yuan (36,800 USD). That’s a $3,200 reduction in price, which is the major reason for the boost in sales. One of the major reasons for this cost cut was that the Model 3 cars in China will be equipped with new cell chemistry inside the battery pack. The Standard Range Plus variant of the Model 3 now has a lithium iron phosphate (LFP) batteries, which will be completely cobalt-free.  This new chemistry will facilitate a range increase of 10kms.

Tesla for a long time now has possessed the desire to make a statement in the European market. The delivery from multiple factories will only help them to achieve their desired dominance.

Ritwik Shah
Ritwik Shah
Aspiring Mechanical Engineer and Formula Student. An automotive and sports enthusiast who is always up for a discussion.


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