Tesla is benefiting from an eventual relaxation of rules by Beijing on foreign ownership of new-energy vehicle makers. "The Shanghai municipal government will fully support the construction of the Tesla factory," its statement said. Tesla billionaire CEO Elon Musk, Shanghai Mayor Ying Yong and other Chinese officials attended a signing ceremony on Tuesday. "The Shanghai plant will certainly improve Tesla's positioning in China and allow it to locally produce and avoid import tariffs. Tesla said construction would begin when permits are granted, and vehicle production would begin two to three years later.