Tesla inc halts plans of buying Shanghai plant amid US-China tensions

U.S. electric car maker Tesla Inc has dropped its plans of buying land to extend its Shanghai plant and develop it into a global export hub, amid the uncertainty created by U.S.-China tensions, people familiar with the matter said, reported Reuters.

The tariffs imposed during former U.S. President Donald Trump’s regime, which includes 25% tariffs on imported Chinese electric vehicles on top of existing levees under still into order, Tesla is now planning to restrict the proportion of China output in its global production, two of the four people stated, reported Reuters.

Tesla had earlier considered expanding exports of its China-made entry-level Model 3 to more markets, including the United States, sources told Reuters, a plan that had not previously been reported.

Presently, Tesla exports China-made Model 3s to Europe, where it is constructing a factory in Germany.

Shares of Tesla dipped as much as 5.3% early on Thursday.