$4 Billion Investment in Shanghai! Tesla's First Grid-Scale Energy Storage Project in China Officially Signed

TradingKey - On June 20, Tesla announced a significant investment of 4 billion yuan for its first grid-scale energy storage project in China. Following the announcement of this agreement, Tesla's stock experienced positive momentum, reaching an intraday high of $332.36 on the 20th, marking a noticeable increase from the previous trading day's closing price.

Tesla stated via its official Weibo account that this is its first grid-side energy storage project in mainland China. Once completed, it will become the largest grid-side storage facility in the country. This project will be implemented in collaboration with Kangfu International Leasing’s subsidiary, Kangao Energy, using Tesla’s Megapack energy storage products to construct a gigawatt-hour-level independent grid-side energy storage station.

As the world's fastest-growing energy storage market, China is highly competitive; local brand CATL holds about 40% of the global market share. Tesla hopes to reduce costs through localized production to counter competition. Reports indicate that CATL may supply battery cells and battery packs for Tesla's Megapack, further strengthening Tesla's supply chain advantages in China.

In terms of business growth, by Q1 2025, Tesla's global energy storage systems added an installed capacity of 10.4 GWh, reflecting a year-on-year growth of 156.6%. The energy storage business has become a key driver of growth for the company.

Industry insiders point out that against the backdrop of U.S.-China trade tensions, this deal is particularly significant for Tesla. By deepening its cooperation in China, Tesla can leverage the vast domestic market and well-established industrial system while also hedging against geopolitical risks.