US electric car maker Tesla has broken ground on its first overseas factory in Shanghai today, with the manufacturer set to be the first foreign invested car company to establish an independent operation in China.
The factory will also become the first to be opened by Tesla outside of the US, as the company looks to churn out its first mass-market electric vehicle from China.
"It's very important that the world transition to sustainable transport and sustainable energy generation - so, solar, battery storage and electric vehicles. And China has been a world leader in that transition. So, we look forward to helping accelerate that transition along with other electric car companies in China," said Elon Musk, CEO of Tesla.
In the last two months, Tesla has slashed prices on its different models in China three times, the second of which came right after China's finance ministry announced it would suspend additional tariffs on US-made vehicles and auto parts for three months.
Tesla said the price cuts are designed to make their cars more "affordable" for customers in the world's top auto market of China, which experts say can either make or break a car manufacturer.
"China, I think, is a really place that ensured JLR's (Jaguar Land Rover) success not only in this market, but also worldwide," said Wang Yan, executive vice president of Public Relations and Corporate Communications with Jaguar Land Rover China.
The Tesla factory in China will also be the country's first car plant that is wholly-owned by a foreign company, a reflection of China's will to open up its car sector even further.
"The opening-up policies have been a steady movement towards opening. And we feel very optimistic about the long-term future. We think the direction has been great," said Musk.
Tesla said it is aiming to complete the initial construction of the plant by the summer, and begin manufacturing by the end of the year. The company's CEO added that the cars produced in the facility would be exclusively sold to Greater China.