Tesla Inc (NASDAQ:TSLA) will spend up to $188 million to ramp up capacity at the Giga Shanghai and hire another 4,000 employees upon completion early next year, cnEVpost reported on Wednesday, citing a company report.

What Happened: The Elon Musk-led electric vehicle company would begin work to "optimize" the production line for Giga Shanghai in December and finish it by April next year.

The project involves expansion of the stamping workshop, body shop, painting workshop, final assembly workshop and logistics operation center. 

The ramp up will take the Tesla total employee count to 15,000 heads once the project is completed, as per the report.

The electric vehicle maker has not disclosed the actual capacity increase but it aims to partly achieve the ramp up with more working hours and the number of employees in addition to the frequency of material turnover.

See Also: Tesla Analyst Says It Could Take Half Of $5-Trillion EV Market, Raises Price Target

Why It Matters: The Giga Shanghai started operations in 2019 and currently manufactures both Model 3 and Model Y vehicles. It is divided into a vehicle production area, a pilot area, a parts production area and a joint workshop as a repair shop.

Tesla had in its second quarter earnings revealed that it has successfully shifted its “export hub” from Fremont Factory and established the Shanghai gigafactory as the primary export hub. 

The Shanghai manufacturing facility was originally meant to cater to local demand.

Building locally made Tesla in China is a key milestone for Tesla as it relies on the world’s largest automotive market for future growth as well. 

See Also: Tesla China Team Gets Elon Musk's Praise As Giga Shanghai Said To Have Begun Mass-Producing Model Y

Tesla analyst Daniel Ives of Wedbush Securities had last week said he expects China could account for 40% of Tesla’s deliveries in 2022.

Price Action: Tesla shares closed 0.63% higher at $1,116 a share on Wednesday.

Photo: Courtesy of Tesla