Tesla invests in major facility

After electric vehicle maker Tesla Inc announced its first factory outside the United States in Shanghai on Tuesday, it became China's first wholly foreign-owned automaker, and the project is the largest ever foreign manufacturing investment in Shanghai.

The Gigafactory, with a projected annual capacity of 500,000 vehicles, comes after China ended restrictions in April requiring foreign automakers to work through local partners.

"The National Development and Reform Commission announced earlier this year that China will scrap foreign investment limits for carmakers that manufacture fully electric and plug-in hybrid vehicles, so the establishment of Tesla's factory is understandable as it is encouraged by the government," said Aaron Guo, associate director of research at Mintel.