The $2 billion Tesla Inc factory started delivering cars in just 357 days, a record for global automakers in China. The first 10 customers from the public received their China-made Model 3 sedans on Tuesday.
Billionaire CEO Musk danced enthusiastically on stage at the event, then stripped off his jacket and flung it aside to reveal a T-shirt with a cartoon of the factory. In a tweet, he labeled the video "NSFW" - not safe for work.
He predicted that "ultimately Tesla Model Y will have more demand than probably all the other cars of Tesla combined", with his voice cracking with emotion at times while talking about the progress of the Shanghai factory.
Musk's tweet of him dancing was viewed 2.5 million times and drew unflattering comparisons to famous Silicon Valley footage of Microsoft chiefs Bill Gates and Steve Ballmer dancing awkwardly at a 1990s Windows launch.
"Admit it Elon, you did it for the memes," one user tweeted https://twitter.com/RenataKonkoly/status/1214544692949475328, along with a picture of Musk stripping off his jacket. "I see you learned your dance moves at Dad school," said another.
"Just tryin to grow my follower count on pornhub …," the billionaire, who has a history of being playful with his Twitter account, retorted.
The ceremony was attended by Shanghai Mayor Ying Yong and other senior government officials.
Tesla executives, however, did not provide further details on the progress of the China-made Model Y project. A Tesla representative declined to comment further.
Tesla's shares, which have jumped about 10% since the beginning of this year, are trading close to their record high after the company beat Wall Street estimates for vehicle deliveries in its fourth quarter.
The positive news from the China factory have also caused a rally in shares of Tesla's Chinese suppliers. Shares of Tianjin Motor Dies Co Ltd have surged about 28% so far in 2020, while VT Industrial Technology Co Ltd is up nearly 6%.
Construction of Tesla's first plant outside the United States began in January 2019 and production started in October.
The factory started with a production capacity of 150,000 Model 3 sedans and Tesla aims to push that to 250,000 vehicles a year, including Model Y, in the plant's first phase.
Tesla unveiled its Model Y in March 2019 and said in October that production of the electric compact SUV at its Fremont facility was running ahead of schedule, adding at the time that it expects to launch the model by summer 2020.
It has said that margin expectations are higher for Model Y than Model 3, while production costs are roughly the same.
Tesla's China website estimates the starting price for Model Y vehicles at 444,000 yuan ($63,911.56). It will announce the retail price later, the website says. The China-made Model 3 sedans are priced at 355,800 yuan before subsidies.
Shanghai Vice Mayor Wu Qing said he hoped to see Tesla extend its cooperation with the city and for the car maker to manufacture more models at its Chinese plant.
By Yilei Sun and Brenda Goh