Tesla (NASDAQ:TSLA) reached a new production milestone on December 8, 2025, as its Shanghai Gigafactory produced its 4,000,000th vehicle, a Starlight Gold Model Y L. The plant achieved the milestone less than 14 months after completing its three millionth unit, a pace enabled by manufacturing integration and a high localization rate.

Shanghai Gigafactory, Tesla’s first outside the United States, has become a central link in the company’s production network since its start-up in 2019. Over six years, the facility has contributed close to half of Tesla’s global electric-vehicle deliveries. Tao Lin, Tesla’s Vice President of Global Affairs, said the plant’s growth has paralleled the development of China’s EV manufacturing ecosystem and highlighted the extent to which Tesla’s product competitiveness is connected to China’s industrial capabilities.

The Shanghai facility is structured as a high-throughput operation, with stamping, welding, painting, and final assembly housed under one roof. The company reports that the plant can complete a new vehicle approximately every 30 seconds. Its supply-chain localization rate has reached 95%, supported by a concentrated network of suppliers in the Yangtze River Delta. More than 400 tier-one suppliers serve the factory, and more than 60 of them also supply other Tesla sites globally.

Model 3 and Model Y units sold in China use more than 95% locally sourced components, and Tesla has stated that this level of localization enables some of the lowest global prices for the two models. The vehicles have undergone multiple update cycles, with roughly 100,000 CNY of cumulative price reductions over six years alongside major product refreshes and dozens of functions added through OTA software updates.

Delivery and export data also reflect the plant’s scale. The China Passenger Car Association reported that the factory delivered 86,700 Model 3 and Model Y vehicles in November 2025, an increase of 10% year-on-year and 40% month-on-month. In October, the factory exported more than 35,000 vehicles, its highest monthly export total in two years.

Tesla’s industrial footprint in Shanghai now extends to energy-storage equipment. In February 2025, the company began operations at an energy-storage Gigafactory that produces Megapack commercial energy-storage systems. The facility is designed for annual production of 10,000 Megapacks, representing nearly 40 GWh of storage capacity. The first units were shipped to Australia within weeks of production start.

The milestone prompts a broader question for the company: how Tesla will deploy Shanghai’s high output in a market experiencing intensified competition, shifting model cycles and phasing out of government subsidies, and how the plant’s scale will influence global allocation strategies as demand patterns evolve.