Factbox-Tesla’s China operations, the EV maker’s global production powerhouse

Reuters reports Tesla is weighing a separation of its China business, potentially to facilitate a future merger with SpaceX, though the report could not be independently verified. The article mainly frames Tesla’s China operation as a strategic production asset: Gigafactory Shanghai, opened in 2019, is Tesla’s largest and most productive plant, its main export hub, and a major driver of global deliveries. Tesla says the Shanghai factory has annual capacity above 950,000 vehicles and produced more than half of global deliveries in 2025. The plant’s high local sourcing rate and supplier network have helped lower costs and limit supply-chain disruption risk. Strategically, the piece also highlights intensifying competition in China from BYD, Xiaomi, Xpeng and Li Auto, which pressure Tesla’s premium EV position. Market impact is centered on Tesla’s corporate structure and China exposure, with any sale/separation of the China business potentially reshaping valuation, control, and merger optionality tied to SpaceX.