WSJ : Tesla Reaches Deal With Shanghai To Build Factory In China

(RTTNews) - Electric-car maker Tesla Inc. (TSLA) has reached an agreement to set up its own manufacturing facility in Shanghai, the wall street journal reported citing to people familiar with the plan.

The deal with Shanghai's government will allow the Silicon Valley auto maker to build a wholly owned factory in the city's free-trade zone, the report said. This arrangement, the first of its kind for a foreign auto maker, could enable Tesla to slash production costs, but it would still likely incur China's 25% import tariff.

Tesla is currently working with the Shanghai government about details of the deal's announcement, such as timing, the report noted.