Tesla signed a contract with Hyundai Glowey to ship export vehicles from the Shanghai plant

IT House reported on Dec. 24 that Tesla signed a one-year, $422 million contract with South Korean logistics company Hyundai Glovis to transport vehicles from the automaker's Shanghai gigafactory in China to other regions.

Tesla has been using its Shanghai-based gigafactory as an outlet hub for its vehicles for much of 2021. Before this year, Tesla said it would not use vehicles produced in Shanghai as a supplementary inventory in other markets. However, the company changed that at the beginning of the new year and began its export program, shipping 7,000 Model 3s directly from Shanghai to Europe, the first vehicles shipped from the Shanghai Gigafactory to other markets.

Tesla CEO Elon Musk said in September that "the Shanghai Gigafactory built cars for exports in the first quarter, then in regions farther away from China, then in areas near China," he detailed the strategy Tesla uses in its Shanghai export business.

TradeWinds, a website that tracks global shipping, said it was Hyundai Glowey's largest contract with a single automaker in the industry's thirteen-year history.

It is not yet known where the vehicles will be shipped from Shanghai, and it is likely that the Model 3 will be shipped from Shanghai to Europe, as the Berlin Gigafactory, which could begin production by the end of this year, will manufacture the Model Y during the initial production phase. However, some Model 3s may also be shipped to the United States, as a Shanghai-built Model 3 was recently discovered in Northern California.

It Home has learned that some analysts are not optimistic about Tesla's export strategy, and Tesla long-term analyst Dan Ives has called the export business at the Shanghai factory a "logistics nightmare" and said that this unsustainable plan is "delaying the delivery time of customers across the region.".