Elon Musk Announces Plans for New Factory Making Megapacks in China



  • Elon Musk announced plans Sunday for a new battery factory in Shanghai during a visit there.
  • The factory will make large-scale energy-storage units called Megapacks, Xinhua reported.
  • Rep. Mike Gallagher met with Apple CEO Tim Cook earlier this month to discuss ties with China.

Elon Musk revealed plans to build a new battery factory during a visit to Shanghai Sunday, China’s official Xinhua news agency reported.

Tesla’s new project, which was officially announced during a signing ceremony, involves building a new Megafactory to make its energy storage Megapack. 

Tesla said the factory will aim to produce 10,000 Megapacks a year to be sold worldwide, per the report.

The Megapack is a huge battery to help stabilize energy grids and can store enough energy to power about 3,600 homes for an hour, according to Tesla. Tesla’s existing Megafactory is in Lathrop, California and can also produce 10,000 units a year.

Musk’s visit to China came amid heightened tensions with the US, including the shooting of an alleged Chinese spy balloon and concern about Beijing’s support for Vladimir Putin and his war in Ukraine.

While the Tesla CEO is continuing to invest in China, other companies may be looking at ways to distance themselves.

Apple mulls ‘economic decoupling’

Earlier this month Rep. Mike Gallagher, a Republican from Wisconsin, and Democrat Raja Krishnamoorthi met tech executives including Apple CEO Tim Cook and execs from Google and Microsoft to discuss their links with China, Bloomberg reported

Gallagher also met with Disney CEO Bog Iger to discuss US media companies censoring their content for the Chinese market. 

“Apple’s at the heart of what is the most complex aspect of this competition, which is companies that have a massive presence in China are going have to deal with the fact that some form of selective economic decoupling is inevitable,” Gallagher told Bloomberg. “It’s going to continue.”

He said that most executives he met wanted “bright, clear lines from the government” telling them which areas of the Chinese economy they should avoid.

Last year Apple began making plans to start moving some production away from China after suffering supply-chain delays due to its zero-COVID policy and protests at the Foxconn factory that makes iPhones.

It is considering increasing production in countries such as India and Vietnam to reduce reliance on Foxconn, according to The Wall Street Journal

Gallagher told Bloomberg that he didn’t expect companies to sever all ties with China. However, if China took military action against Taiwan he said all bets would be off.

Apple is the biggest customer of Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest chipmaker. It produces most of the world’s 1.4 billion smartphone processors and more than half the microcontrollers used by car manufacturers.

In March, Robert O’Brien, who served as national security advisor in the Trump administration, told Semafor the US would rather destroy these factories rather than let them fall into Chinese control.

Tesla, Apple, and Gallagher didn’t immediately respond to requests for comment from Insider, made outside normal working hours.


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