Wall Street Journal sources claim that Tesla has a deal to build a factory in Shanghai's free trade zone. Tesla would still have to pay the 25 percent import duty, but it would retain full control and could likely offset the tariff with lower production and shipping costs. Tesla reportedly lands deal to build an EV factory in Shanghai Posted via the PriusChat mobile app.
The key will be if they will qualify for incentives for Chinese built be sure or not, and if Chinese parts will not have the extra vat penalties as whole foreign cars