Tesla breaks ground on Shanghai factory

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Tesla CEO Elon Musk, center, and Shanghai’s Mayor Ying Yong, right, attend the Tesla Shanghai Gigafactory groundbreaking ceremony in Shanghai. (Reuters)
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The land of Tesla Gigafactory at a groundbreaking ceremony of Tesla Shanghai Gigafactory in Shanghai. (Reuters)
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A Chinese flag is seen on the land secured by Tesla for its Gigafactory in Shanghai, China. (Reuters)
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Tesla plans to produce its Model 3 and Model Y cars in the initial phase of production at the Shanghai plant. (Reuters)
Updated 07 January 2019
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Tesla breaks ground on Shanghai factory

  • ‘Looking forward to breaking ground on the @Tesla Shanghai Gigafactory today!’ Musk wrote in a post on Twitter
  • Tesla has said it aims to produce its Model 3 mass-market car from 2019 at the new plant

BEIJING: Tesla broke ground Monday for a factory in Shanghai, its first outside the United States.

CEO Elon Musk said Monday on Twitter that the company will start production in China of its Model 3 and a planned crossover by the end of the year.

Tesla announced plans in July to build the Gigafactory 3 facility in China, the biggest electric vehicle market, despite trade tension between Beijing and Washington. That followed Beijing’s announcement it would end restrictions this year on foreign ownership of electric vehicle producers in an effort to spur industry development.

“Looking forward to breaking ground on the @Tesla Shanghai Gigafactory today!” said Musk on Twitter. “Aiming to finish initial construction this summer, start Model 3 production end of year & reach high volume production next year.”

China’s state broadcaster CCTV showed Musk and other Tesla and local officials attending a chilly ceremony in the rain Monday in Shanghai’s outskirts.

The Shanghai factory will produce “affordable versions of 3/Y for greater China,” Musk said. The company refers to a planned crossover that has yet to receive a formal name as the Y.

Higher-priced models will be built in the United States for export to China, Musk said.

Tesla, based on Palo Alto, California, global automakers including General Motors Co., Volkswagen AG and Nissan Motor Corp. that are pouring billions of dollars into manufacturing electric vehicles in China.

Local production would eliminate risks from tariffs and other import controls. It would help Tesla develop parts suppliers to support service and make its vehicles more appealing to mainstream Chinese buyers.

Tesla said in October it had signed an agreement for a 210-acre (84-hectare) site in the Lingang district in southeastern Shanghai.

Shanghai is a center of China’s auto industry and home to state-owned Shanghai Automotive Industries Corp., the main local manufacturer for GM and VW.

Tesla has yet to give a price tag but the Shanghai government said it would be the biggest foreign investment there to date.

The company faces competition from Chinese brands including BYD Auto and BAIC Group that already sell tens of thousands of hybrid and pure-electric sedans and SUVs annually.

Until now, foreign automakers that wanted to manufacture in China were required to work through state-owned partners. Foreign brands balked at bringing electric vehicle technology into China to avoid having to share it with potential competitors.

The first of the new electric models being developed by global automakers to hit the market, Nissan’s Sylphy Zero Emission, began rolling off a production line in southern China in August.

Lower-priced electric models from GM, Volkswagen and other global brands are due to hit the market starting this year, well before Tesla is up and running in Shanghai.


Head of Saudi Arabia’s SRC: ‘Ask banks for a mortgage, and we will refinance it’

Updated 25 April 2019
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Head of Saudi Arabia’s SRC: ‘Ask banks for a mortgage, and we will refinance it’

  • SRC CEO Fabrice Susini: One of our key objectives is to ensure that the banks are extending loans to more and more people
  • Extending home-ownership is one of the cornerstones of the Vision 2030 strategy to diversify the economy away from oil production

RIYADH: The head of the state-owned Saudi Real Estate Refinance Company (SRC) has made an unprecedented offer to the Kingdom’s home-seekers to underwrite future mortgages.
Speaking at the Financial Sector Conference in Riyadh, Fabrice Susini, SRC CEO, told the audience: “Ask them (the banks) for a mortgage, and we will refinance it.”
Although Susini later clarified his remarks to show that he still expected normal standards of mortgage applications to be met, the on-stage show of bravado illustrates SRC’s commitment to facilitate home-ownership in the Kingdom.
“Obviously if you have no revenue, no income, poor credit history, that will not apply. Now if you have a job, it is different. We have people in senior positions at big foreign banks that could not get a mortgage,” he explained.
He said that Saudi banks have traditionally assessed mortgages on the basis of “flow stability” of earnings. Government employees, or those of big corporations like Saudi Aramco and SABIC, found it easy to get mortgages “because you were there for life.”
“One of our key objectives is to ensure that the banks are extending loans to more and more people. The government is pushing for entrepreneurship, private development, private jobs. If you work in the private sector and cannot get a mortgage the next thing you will do is go to the government for a job,” Susini said.
Extending home-ownership is one of the cornerstones of the Vision 2030 strategy to diversify the economy away from oil production. Saudi Arabia has one of the lowest rates of mortgage penetration of any G20 country — in single digit percentages, compared with others at up to 50 percent.