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Tesla Model 3 and Y production switching to China for Australia, Europe

Tesla is set to start sourcing Australian Model 3 and Model Y supply from China, according to a new Bloomberg report.

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Paul Maric
Paul Maric
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Planning on buying a Tesla Model 3 or Model Y in Australia? It might soon be made in China.

A report from Bloomberg says Tesla is planning to ship the Model 3 and Model Y from its Chinese factory to Europe and Asia – including Australia and New Zealand – by the end of 2020.

According to a Bloomberg source close to the Chinese manufacturing operation, Tesla’s plan to supply the European and Asian markets from its Shanghai factory is part of a strategy to cut the wait for customers ordering cars from its plant in Fremont, California.

Tesla’s plant in Shanghai has a current production capacity of 250,000 cars annually, and only produces the Model 3 sedan. Production capacity is expected to expand to 500,000 units per annum by the end of 2020, when phase two of the plant’s construction is complete.

The company currently delivers around 11,000 Model 3s every month in China, leaving more than enough capacity to service Europe, which accounts for around 40,000 deliveries per quarter, along with other Asian markets.

Tesla is yet to commence production of its Model Y SUV at the Shanghai plant, which is expected to increase production output every further.

Bloomberg reports that by the end of 2020 around 80 per cent of parts used at the Shanghai factory will be sourced in China, with a plan to extend that to 100 per cent by mid-2021.

Delivery to Europe from the Shanghai factory is expected to be a stopgap until Tesla’s European factory based in Berlin is completed, which Tesla CEO Elon Musk expects to be completed in the middle of 2021.

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Paul Maric
Paul Maric

Paul Maric is an Australian car expert & automotive journalist based in Melbourne, Australia. Paul is co-founder of CarExpert.com.au & formerly part of the CarAdvice founding team.

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