U.S. carmaker Tesla Inc. officially launched its new mega factory project that is capable of producing 10,000 Megapacks a year in Shanghai, the company announced.

A signing ceremony for land acquisition of the project was held on Friday morning in Shanghai, marking the official opening of what the company called a  "milestone project."

Megapack is a powerful battery that provides energy storage and support, helping to stabilize the grid and prevent outages, information on Tesla's website shows.

The new project, located in the Lingang new area of the China (Shanghai) Pilot Free Trade Zone, is scheduled to break ground in the first quarter of 2024 and start production in the fourth quarter.

The factory will initially produce 10,000 Megapack units every year, equal to nearly 40 GWh of energy storage. The products will be sold worldwide.

In January 2019, Tesla broke ground on its Shanghai Gigafactory, becoming the first to benefit from a new policy allowing foreign carmakers to establish wholly owned subsidiaries in China.

Over the past years, the company has continued to ramp up investment in Lingang, expanding the production capacity of its Shanghai Gigafactory and building more facilities, including a supercharger manufacturing factory.