Tesla Announces New Megapack Battery Factory In Shanghai

• Megapack batteries are Tesla’s battery storage products that provide 3-megawatt hours (MWh) of storage and 1.5 MW of inverter capacity. 

•  The new factory is expected to create another industrial cluster worth over $14.6 billion in Shanghai.

Tesla Inc. announced on Sunday that it would build a new Megafactory in Shanghai with a production capacity of up to 10,000 Megapacks per year, which is equivalent to 40GWh of energy storage per year. 

The new factory will be located in the Lin-gang Special Area of China (Shanghai) Pilot Free Trade Zone and the work will commence in the third quarter of 2023. The landing of the factory is expected to create another industrial cluster worth over $14.6 billion (100 billion yuan), Chinese state media Xinhua reported.

Tesla has an existing Megafactory in Lathrop, California, with a production capacity of 10,000 Megapacks per year.

The carmaker’s first Gigafactory outside the US, in Shanghai, delivered 710,000 vehicles in 2022, an increase of 48% from 2021, and has now become the company’s primary vehicle export hub, with electric cars selling well in Asia-Pacific, Europe and other regions. 

The unit began producing Model 3 cars in Shanghai in 2019 and now is capable of producing 22,000 units of cars per week. Rising inventory has however forced the company to enforce major price cuts across the globe, as demand started weakening in the third quarter.

Understanding Tesla’s Megapacks

Megapacks are Tesla’s battery storage products that provide 3-megawatt hours (MWhs) of storage and 1.5 MW of inverter capacity. Tesla had initially said that it could deploy an emissions-free 250 MW, 1 GWh power plant in less than three months on a three-acre footprint, using Megapacks – four times faster than a traditional fossil fuel power plant of that size. Megapack can also be DC-connected directly to solar.

Tesla has developed its own software in-house to monitor, control and monetize Megapack installations. All Megapacks are connected to Tesla’s monitoring and control platform for large-scale utility projects and microgrids called Powerhub and can also integrate with its machine-learning platform, Autobidder, for automated energy trading.