Tesla breaks ground on Gigafactory 3 in China

Tesla is breaking ground on Gigafactory 3 in China today as it moves forward with its accelerated plan to establish manufacturing capacity in the country due to the uncertain trade situation.

The facility will produce Model 3 and Model Y cars as it pushes to grow its presence in the world's largest car market.

The American automaker faces rising competition from local rivals in China.

But the new factory would help Tesla avoid US tariffs on car imports into the country.

Earlier this summer, Tesla announced a deal with the Shanghai government to build a wholly owned local factory.

Tesla then accelerated the Gigafactory 3 plans in response to the trade war between the US and China.

In October, Tesla announced that it secured 210-acres of land for Gigafactory 3 in China and said that it is ‘on track’ with an accelerated construction plan.

Last month, Deputy Secretary of the Municipal Party Committee and Mayor of Shanghai Ying Yong stated that Tesla “basically completed land levelling and is about to start construction” at Gigafactory 3. The project is “expected to be partially put into operation in the second half of next year.”

Now CEO Elon Musk confirmed that they are breaking ground at the site today.

In a series of tweets on Monday, Musk said the plant would build "affordable versions" of the Tesla Model 3 - the carmaker's mass-market vehicle - and its proposed Model Y for the Greater China region.

He said the so-called Gigafactory - which could cost as much as $5bn (£4bn) according to reports - would start Model 3 production at the end of the year.

"Aiming to finish initial construction this summer, start Model 3 production end of the year [and] reach high volume production next year" the entrepreneur tweeted.

Tesla's push into China comes amid simmering trade tensions between Beijing and Washington.