Tesla is in discussions to purchase about $2.9 billion worth of solar manufacturing equipment from Chinese firms, as the company ramps up plans to expand solar production in the United States, according to a Reuters report citing people familiar with the matter.
The equipment would be used to build solar panels and cells, forming a key part of CEO Elon Musk’s push to scale up energy production.
Among the companies in talks are Suzhou Maxwell Technologies, a major player in solar manufacturing equipment, alongside Shenzhen S.C New Energy Technology and Laplace Renewable Energy Technology, Reuters reported. Shares in all three companies jumped more than 7% following the Reuters report.
The roughly 20 billion yuan ($2.9 billion) order includes screen-printing production lines and other equipment. Some of the machinery will require export approval from Chinese regulators, though it’s not yet clear how much it will cost or how long the process will take.
The equipment is scheduled for delivery before autumn this year, with two sources saying it will be shipped to Texas, according to Reuters.
Musk’s 100 GW vision
The reported deal didn’t come out of nowhere.
Musk has been talking up solar in a big way. At the World Economic Forum in Davos in January, he argued that solar could single-handedly meet all of America’s electricity needs, including the ballooning demands of AI data centres. On Tesla’s Q4 2025 earnings call, he put a finer point on it:
“We’re going to work toward getting 100 GW a year of solar cell production, integrating across the entire supply chain from raw materials all the way to finished solar panels,” he said.
Tesla’s own job listings back up the ambition, with postings calling for 100 gigawatts of “solar manufacturing from raw materials on American soil before the end of 2028.”
The solar capacity, Reuters’ sources said, is intended primarily for Tesla’s own use, though some will also go toward powering SpaceX satellites.
The supply chain paradox
There’s a tension baked into all of this that is hard to ignore.
Musk has been vocal about the cost burden tariffs place on solar energy in the US, saying at Davos that “the tariff barriers for solar are extremely high. And that makes the economics of deploying solar… Artificially high because China makes almost all the solar.”
And yet, building that American solar factory requires buying the machines from China, the very country the US is trying to reduce its dependence on.
Fortunately for Tesla, solar manufacturing equipment was carved out of tariffs by the Biden administration in 2024, after US solar panel makers argued there were simply no domestic alternatives to the machinery they needed. The Trump administration has since extended that exemption, even as it has slashed federal subsidies for solar and wind energy more broadly.
This deal also underscores a wider reality: Tesla still leans on approximately 400 China-based suppliers to keep its costs manageable. Sixty of those suppliers serve Tesla’s global operations, including its US electric vehicle plants. When tariff hikes disrupted shipments from China last year, production preparations for the Cybertruck and Semi models were significantly disrupted, per Reuters.
If completed, the agreement would mark one of Tesla’s largest investments in solar manufacturing infrastructure and a critical step toward its 2028 target.
But the scale is enormous. For context, total US solar capacity stood at about 135 GW as of 2024, according to industry data cited by Reuters. Achieving 100 GW of new manufacturing capacity in just a few years would be a massive undertaking.
Also read: Solar manufacturing is only one side of the infrastructure race, and new clean-energy projects for AI data centers show how power demand is reshaping tech investment.