Bloomberg reports that a new business licence has been approved for a company registered by Tesla's set-up in Hong Kong. Ltd., which is listed as the sole shareholder of the new Shanghai-flagged corporation. There was no formal announcement by Tesla, which has declined to comment. Amid pressure from the Trump Administration and lobbying from Tesla, CEO Elon Musk recently praised China for a "willingness to open their markets" and said he believed "they will do the right thing".
Tesla has been in protracted negotiations to set up its own plant in Shanghai to produce vehicles locally, gaining access to China's rapidly growing market for electric vehicles while avoiding high import tariffs. It has other wholly-owned firms registered in China focused on sales and research and development.More news: Sporting Lisbon's Bas Dost injured by hooded training ground attackers
The new company, Tesla (Shanghai) Co Ltd, was set up with 100 million yuan (around £11.6 million), and will focus on "technical development; technical services; technical consultation; technology transfer in the field of electric vehicles, spare parts, batteries, and energy storage equipment; electric auto display; and product promotion", according to Sina Finance. The Chinese market contributed $2 billion, up 90 percent.
Musk has been critical of China's tough rules for foreign businesses, saying they created an uneven playing field. Earlier this month, Tesla chief Elon Musk thanked Beijing for scrapping limits on foreign ownership of local electric vehicle firms.More news: Scotland rejects key Brexit bill sparking fears of constitutional crisis
Presently, foreign new-energy vehicle makers are subject to a 50 per cent ownership cap in their mainland joint ventures.
The Palo Alto, California-based company has been working with Shanghai's government since past year to explore assembling cars in China.More news: Three, two, one: New ways to control Google Pixel Buds