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Tesla Possibly Importing EVs from China

Is Tesla planning to import popular EVs from China? We have the rumors, responses, and possible timeline right here. 

Rumored Tesla Import Plans

Tesla Model Y - tesla.com
Tesla Model Y - tesla.com

Is the electric vehicle leader Tesla going to be importing some of its vehicles from China? One report says they are. According to the news agency Reuters, Tesla has considered plans for exporting electric vehicles made in China to the United States and Canada. According to the news report, people with knowledge of the plans say that Model 3 sedans and Model Y crossovers that were made in Gigafactory Shanghai in Shanghai, China could be sold in North America very soon.

Potential Timeline and Regulatory Snags

Tesla Gigafactory - tesla.com
Tesla Gigafactory - tesla.com

Tesla is still evaluating whether parts made by China-based suppliers would be compliant with U.S. and Canadian automaking regulations. The Shanghai plant has been working on a small batch of test-run production vehicles that could be exported to North America sometime in the first business quarter of 2023. If the U.S. or Canada finds that this plan doesn’t meet their regulations, Tesla could find a work around or scrap the possible plan altogether.

Possible Tax Credit Complications

Tesla Model 3 - tesla.com
Tesla Model 3 - tesla.com

If Tesla were to move forward with a plan like this, it would likely benefit from lower raw material costs. It could complicate purchases for American buyers, though. On August 16, President Joe Biden signed the Inflation Reduction Act (IRA) into law. We published a full article on What the New EV Tax Credits Mean for Buyers, but this possible Tesla development could change things.

Part of the IRA included rebates for up to $7,500 on purchases of an EV. However, as dictated in the law, the incentive would vary depending on whether the vehicle was imported. Tesla vehicles imported from China may not qualify for as much of the rebate or for any of the rebate at all.

Musk Responds to Reports

Teslas charging - tesla.com
Teslas charging - tesla.com

Elon Musk, Tesla Chief Executive, tweeted one word in response to the Reuters report: “False.” Neither Musk nor Tesla provided further comment on the Reuters reporting. This would be a switch for the electric car maker as every Tesla EV sold in North America to date has been built at the two Tesla plants in Fremont, California, and Austin, Texas.

However, vehicles currently made in Gigafactory Shanghai are exported to other areas around the globe. Model 3 and Model Y EVs manufactured at Gigafactory Shanghai are sold in China and also exported to markets in Europe, Australia, and Southeast Asia.

Other automakers are turning to China for their EV production needs, too. The Polestar 3 will begin production in China and be exported to the U.S. by the end of 2023. Volvo Cars, the owner of Polestar, said additional manufacturing will take place at the Ridgeville, South Carolina facility in the U.S. by mid-2024. From there, Volvo plans to have North American and other markets switch from China production to U.S. production.

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Jesse Batson

Jesse Batson earned his journalism degree from South Dakota State University. No stranger to newsgathering and reporting, Jesse spent 13 years in TV news. 10 of those years were spent working in Charlotte, NC, home of NASCAR. A highlight of his time there was being able to take a lap around the Charlotte Motor Speedway. His interest in vehicles, starting with Matchbox cars, a Big Wheel, and the Transformers, evolved into taking photos of motocross events. Now, he puts his research skills to use on car culture, reviews, and comparisons.

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