BEIJING, May 3 (TMTPOST)— For the year without new launches, Tesla focuses more on the expansion of production capacity, especially in Shanghai, one of the automobile manufacturing centers in China.

Source: Visual China

In a letter to local government dated May 1, Tesla revealed its vision of making Shanghai "the world's largest vehicle export hub" with a new plan to build a plant that is set to produce 450,000 electric vehicles per year. Located in Shanghai Lingang free trade zone too, the new plant would be next to the existing Gigafactory, home to Tesla’s first factory outside its home market U.S., the according to the letter, obtained by Reuters.

Tesla China halted production in its Shanghai factory on March 28 amid the Covid-19 lockdowns and got about 8,000 workers back three weeks later. It was reported that the plant was operating in a closed-loop system, restricting the contact with the outside world, and each worker was provided a sleeping bag and mattress as they had to sleep at the factory as a result.

In the recent letter, Tesla expressed its appreciation for local officials’ reopening efforts. "They fought for three consecutive days, working round the clock and non-stop to guarantee our company's workers could return to the factory,” the U.S. EV maker said.

Tesla CEO Elon Musk has already showed his confidence of Shanghai plant’s reopening. “, I think we will see record output per week from [Tesla's factory in] Shanghai this quarter, albeit we are missing a couple of weeks," he said at the investor conference call when his company last month reported record high earnings for five consecutive quarters. In the statement of financial results for the first quarter, Tesla noted Shanghai plant’s weekly production rates were strong that quarter, though the Covid resurgence in Shanghai led to the temporary shutdown of the plant and parts of its supply chain.

From the second to third quarter of the year, the new energy vehicle sector in China will see a strong recovery, as both production and capacity of leaders would further unleash their growth potential, Cui Dongshu, the secretary general of China Passenger Car Association (CPCA), said at a recent online panel. In particular, Cui took Tesla China for example. He expected Tesla’s monthly output to increase from 60,000 to 70,000 units to 80,000 to 90,000 units after expanding production in June.