Tesla is in advanced talks to purchase approximately $2.9 billion worth of solar manufacturing equipment from Chinese suppliers, a move central to CEO Elon Musk's ambitious plan to establish 100 gigawatts of solar manufacturing capacity on American soil by the end of 2028. The initiative, reported by Reuters, underscores a strategic push to localize clean energy production amid rising U.S. power demand, particularly from data centers and AI infrastructure.
The procurement package, valued at around 20 billion yuan, includes advanced screen-printing production lines essential for solar cell manufacturing. Suzhou Maxwell Technologies, the world's largest producer of such equipment, has emerged as the leading contender and has already applied for export approval from China's commerce ministry—a required step for certain advanced manufacturing shipments. Other potential suppliers in the deal are Shenzhen S.C New Energy Technology and Laplace Renewable Energy Technology.
Suppliers have been instructed to complete shipments before autumn, with machinery destined for Tesla's expanding manufacturing footprint in Texas. However, the approval timeline from Chinese regulators remains uncertain, and any delays could impact installation schedules and initial production ramp-up targets.
This massive equipment order supports Tesla's internal hiring plans and public job postings that outline a goal of establishing a full solar supply chain "from raw materials on American soil." Musk stated in January that solar power could meet all U.S. electricity needs. The planned solar capacity is expected to primarily power Tesla's own operations, with a portion also allocated to support SpaceX satellites, indicating a move toward vertically integrated energy systems across Musk's companies.
The deal highlights a tension in U.S. industrial policy: while aiming to reduce dependence on China, rebuilding domestic solar production currently relies on specialized Chinese equipment. Solar manufacturing equipment was exempted from tariffs by both the Biden and Trump administrations due to a lack of domestic alternatives. Tesla itself relies on about 400 China-based suppliers globally to control costs.
Achieving 100 GW of solar manufacturing capacity in two to three years would be a monumental feat. For context, the entire U.S. had a total electricity generating capacity of roughly 1,300 GW in 2024, with solar accounting for only 135 GW. The scale of this potential order suggests Tesla is moving beyond talk into concrete action to address energy security and the explosive growth in power demand.
