Tesla will expand to China as it raises prices to offset tariffs: 3 things to know

Tesla inked a deal with Chinese authorities July 10 to build its first factory outside of the U.S. in Shanghai, according to Reuters.

The electric car maker's global production would more than double under the plans. Tesla CEO Elon Musk met with Chinese officials in Shanghai July 10 to announce the deal, which comes as Tesla hiked prices on U.S.-made cars sold in China to offset new retaliatory tariffs China issued against the U.S.

Tesla said the first cars will be produced in Shanghai in about two years. The company plans to produce up to 500,000 vehicles per year once the plant is open for about two to three years, Reuters reports.

Most car manufacturing plants build about 200,000 to 300,000 vehicles a year, making Tesla's Shanghai plant large by auto industry standards. Tesla's shares increased 1.5 percent on the news, according to the report.

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