Tesla's second factory site selection, the local government to the death

Not long ago, the "Liaoning Release" released a message saying, "Combined with the urban renewal of the Wenguan area, it has opened up the space for industrial development and laid the foundation for the landing of tesla and other extraordinarily large new energy vehicle projects." ”

A stone stirs up a thousand layers of waves. Many people interpreted this as tesla's second factory about to land in Shenyang, but this news was quickly denied, and the "Liaoning Release" also quickly deleted the article.

In fact, in addition to Shenyang, Guangzhou, Shenzhen, Qingdao, Yibin, Chongqing, Hefei, Wuhan, Xi'an and other cities have also been eyebrow-to-eye with Tesla, frequent rumors. Is it the nine sons who snatch the concubine or the two peaches that kill the three soldiers? The location of Tesla's second factory is confusing and full of doubts.

1

In October 2021, Tesla CEO Musk announced at the shareholders' meeting that it will achieve global sales of 20 million vehicles by 2030.

At present, Tesla has a total of four car assembly plants, namely the Fremont Gigafactory in California, the Shanghai Gigafactory in China, the Austin Gigafactory in Texas, and the Berlin Gigafactory in Germany. Among them, the gigafactory in Fremont, California, and Shanghai, China, has been in operation for many years and is currently the most important production base for Tesla Motors. In the face of strong demand, the two factories have basically achieved full load operation.

Of the two remaining gigafactories, Musk previously said he would deliver cars to consumers at the end of the first quarter of this year, while the Berlin Gigafactory had just received production approval from the local government on March 4, and was still far from mass production.

The data shows that in the whole year of 2021, Tesla will deliver 930,000 vehicles worldwide, and Tesla will only increase production capacity in the next few years if it wants to achieve the ambitious goal of selling 20 million vehicles in 2030.

And Tesla has been moving continuously.

The first is to expand on the existing basis. In November last year, Tesla announced the environmental impact assessment of the Shanghai Gigafactory expansion project, with a total investment of 1.2 billion yuan, which is expected to be completed in April 2022. In March, Musk also said on Twitter that it would consider a large-scale expansion of the Fremont Gigafactory in California.

The second is to find a new location for the Tesla factory. On a Tesla earnings call in January, Musk publicly stated that the company was selecting a site for a new factory, and that relevant information could be announced by the end of the year.

When shanghai was originally selected as the Tesla gigafactory, Shanghai set a number of records: in 2018, it signed the contract, obtained the land that year, obtained the construction permit in the same year, and realized the start of construction in 2019, the year of production, and the delivery of the same year. Compared with the approval process of foreign factories, Shanghai speed has undoubtedly left a deep impression on Tesla.

More importantly, since 2015, China has become the world's largest sales market for new energy vehicles for many years, and has a rich and complete new energy supporting industry chain. Therefore, whether it is from the approval of production efficiency, market size or supply chain, Tesla's second factory is likely to land in China.

2

How popular is the location of Tesla's second factory in China?

We can get a glimpse of what's going on in the news everywhere:

In October 2021, Shenyang leaders went out to attract investment, visited Tesla's China headquarters, and exchanged views on the future layout planning and sales of Tesla's northeast headquarters project.

In November 2021, a number of media reported that Tesla China has secretly signed a contract, and China's second factory will be located in Qingdao, Shandong, for a time full of wind and rain, but Tesla quickly debunked rumors and denied it;

In February 2022, Henan Province issued the "Notice on Printing and Distributing the "14th Five-Year Plan" of Henan Province to Deepen Regional Cooperation and Integrate into the Docking of Major National Strategic Plans", which specifically mentioned that in emerging industries, Tesla Motors should be introduced;

Some netizens even left messages on the government website in Tianjin, suggesting the introduction of Tesla's second factory. Tianjin said that it maintains close contact with Tesla Motors and actively negotiates.

For the location of Tesla's second factory, the local governments have shown great enthusiasm and enthusiasm, and the logic behind it is not difficult to understand.

In the past period, industrial transformation has been frequently mentioned in government work reports in various places. In order to accelerate the iterative upgrading of the industry and boost the economic growth rate, various places have begun to bet on emerging industries, including new energy vehicles, with the intention of creating a new growth pole.

In February 2020, Hefei invested 7 billion yuan to increase the capital of the new domestic new energy car manufacturing force - Weilai Automobile, pulling the desperate Weilai Automobile ashore. According to the signed agreement, NIO's China headquarters project will be located in Hefei. As Weilai Automobile's stock price bottomed out and rebounded, Hefei also reaped several times the investment income.

Other domestic new energy vehicle manufacturers have also been chased and have become guests at the invitation of local governments: among them, Xiaomi Automobile Factory and Ideal Automobile Factory have landed in Beijing, Xiaopeng Automobile has been included in Wuhan, and Zero-Run Automobile has chosen to hold hands with Hangzhou.

As the boss of new energy vehicles, Tesla, whether it is the number of automobile production and sales or brand influence, is riding the dust, far better than other new energy vehicle brands. A more intuitive data, in 2021, the output value of new energy vehicles in Shanghai will exceed 160 billion yuan, of which Tesla's Shanghai factory will contribute more than 150 billion yuan.

Especially in the context of the general financial constraints in various places, the answer to why the location of Tesla's second factory is so sought-after is self-evident.

3

Tesla has an urgent need to build a new second factory, and local governments have a good wish to introduce Tesla, which should be a hit and everyone should be happy according to common sense. However, the reality is that the news of the location of the second factory is flying everywhere, and Tesla has frequently interacted with various places, but Musk has been secretive about the final location and refuses to show the bottom card.

Musk has been to China nine times and is well versed in Chinese culture. In order to win the hearts of Chinese consumers, Musk can communicate with netizens with Chinese on Weibo, and can strip and dance at the delivery site in Shanghai. In order to grab the greatest commercial benefits, Musk is also very likely to learn the Chinese art of war.

Let's review a few of Tesla's past events. In order to build Tesla's super battery factory in the United States, Musk used the project's employment opportunities, fiscal taxes, etc. to lobby across the United States, and eventually at least seven states participated in crazy bidding, and Tesla also got super-large-scale land and huge financial concessions from Nedahua as desired.

Before the Gigafactory chose Shanghai, several cities approached Tesla and promised various preferential conditions.

Tesla eventually chose Shanghai between Guangzhou, Shanghai, Suzhou and other places. Because shanghai, which has a lot of money, has never given a fiscal preferential policy before. Tesla's annual report shows that the company received $46 million, $123 million and $6 million in cash incentives from the Shanghai government between 2019 and 2021, respectively; the Shanghai Gigafactory also enjoys a corporate income tax rate of 15%, which is much lower than the statutory tax rate of 25%. In addition, there are huge bank low-interest loans, large areas of low-cost land and other preferential treatment, which are beyond the reach of other cities.

If it is only a comparison of the business environment, industrial facilities and transportation, it is fair. But Tesla's strategy is to spread the information of building a factory in the market - like a scumbag who falls in love, does not admit it, does not refuse. Under the pattern of stock competition, let the local governments frantically "roll in".

Sandpipers and clams compete, and fishermen gain profits. In order to cut corners and take shortcuts, local governments have competed to introduce more preferential subsidy policies, and even do not hesitate to "dig the wall" to compete viciously, which is bound to pay a higher cost.

In fact, in order to oppose this kind of unfair competition, the State Council issued the Notice on Clearing up and Standardizing Preferential Policies such as Taxation in 2014, which comprehensively cleaned up various preferential policies formulated by various regions by building a unified, open, competitive and orderly market system, thus pulling each region to the same running line. The policy was intended to encourage fair competition, but it was later implemented in a Waterloo process that ended abruptly a few months later.

Now that the location of Tesla's second factory is imminent, it is foreseeable that the familiar drama will be staged again. If it is a mutually beneficial and win-win investment, we will welcome it; if it is a routine that repeats the same trick, we must be vigilant.

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