Featured Image Credit: Tesla China
Tesla Giga Shanghai is preparing to produce the MIC Model 3 Performance variant based on applications it submitted to China’s Ministry of Industry and Information Technology (MIIT). It may have also filed papers to manufacture the Model 3 Long Range AWD variant.
Tesla China’s starting price for the dual-motor MIC Model 3 Performance variant might be RMB¥419,800 (US$59,223). According to local media, the MIC Model 3 Performance is equipped with a 137/202kW motor. In comparison, the US-made Model 3 Performance has a 147/211 kW motor. It also weighs a little less than the imported version from the Fremont Factory at 1836kg (4047lbs). The locally-made M3 Performance’s lighter weight could result in better efficiency.
The slight changes between the Model 3 Performance made in the Fremont Factory and Giga Shanghai could be proof that Tesla has expanded its local supply chain in China even further as predicted by Zachary Kirkhorn in the first-quarter Earnings Call. Tesla’s CFO calculated that as Giga Shanghai continues to localize its supply chain, TSLA could continue to reduce the price of MIC models and expand its margin.
Credit: Tesla China
“Yeah. And on the manufacturing cost portion of the question, the cost of vehicles produced in Shanghai in Q1 is already lower than the cost to produce the Model 3 in Fremont, and there's still significant opportunity left to take costs out.
"So fixed cost absorption from higher production volumes, which are occurring in Q2 and will occur through the rest of the year were not fully localized on the supply chain yet. And so while a lot of the supply chain is localized, it's not complete, and there's additional opportunities there. And so we'll continue to bring the price down and expand margin -- costs down and expand margin even with this reduction in price that Elon mentioned on the standard range version of the vehicle,” said Kirkhorn.
Giga Shanghai started MIC Model 3 Standard Range+ deliveries In January, approximately one year after Elon Musk broke ground on the site. And it seems that the China-based Gigafactory has been crushing every milestone ever since. Giga Shanghai significantly contributed to TSLA’s impressive Q1 2020 results and may do so again in the second quarter with the MIC Model 3 Long Range RWD. If Giga Shanghai’s applications for the Performance and Long Range AWD variants are approved soon, it could start production and deliveries by the end of the year—given how fast the factory moves.
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