By CHEN Xiaotong

US EV maker Tesla said on Sunday that it is to build a new factory in Shanghai to make its “energy-storage product” Megapack.

Elon Musk's automaker will break ground on the plant in the third quarter and production will get underway just over a year from now in the second quarter of 2024. It will be the first Megapack plant outside the US.

The factory will initially produce 10,000 Megapacks every year, approximately 40 GWh of energy storage and will be sold worldwide. The plant will be located at Lin-gang on the Shanghai FTZ where, in January 2019, Tesla broke ground on its Gigafactory, becoming the first foreign carmaker to establish a wholly owned subsidiary in China.

The Tesla Megapack is a giant lithium-ion battery launched in 2019. Sharing much of its technology with the batteries in EVs, the “stationary energy storage product” is very much bigger than a typical car battery, about the size of a standard shipping container. It is used at power stations where supplies are intermittent and variable – wind and solar power, for example - helping to stabilize the grid and prevent outages, according to Tesla's website.

Each Megapack can store up to 3.9 megawatt-hours of electricity. That’s enough to keep a Tesla going for about 15 million kilometers, 25 times to the moon and back.

Elon Musk is expected to visit China in the next few days. 

Musk is said to be traveling with Tom Zhu, Tesla's new senior vice president of automotive. Previously Zhu led the construction and operations of the Shanghai factory, living in the facility during Covid-related lockdowns. Musk will reportedly stop by the Gigafactory.

China is Tesla's second-largest market after the United States, accounting for 22.3 percent of revenue in 2022. Its Shanghai plant is Tesla’s chief production center. The plant delivered 700,000 vehicles in 2022, an increase of 48 percent from 2021.

It has become Tesla's primary vehicle export hub, shipping EVs to the Asia-Pacific, Europe and other regions.