Tesla's (TSLA - Get Report) brand-new China factory will begin producing battery-powered cars this month, though year-end production targets may not be met due to uncertainties surrounding orders, labor and suppliers, sources told Reuters on Wednesday.

The California-based electric vehicle maker is aiming to produce at least 1,000 Model 3s a week from the new Shanghai-based factory by the end of the year. The plant's mass-production schedule is crucial for Tesla's goal of reaching a 2019 production rate of 500,000 vehicles.

Tesla will release figures on its third-quarter deliveries this week.

The $2 billion factory -- Tesla's first car manufacturing and production site outside of the U.S. -- gained key government approvals last month and is on schedule to start production in October, the sources told Reuters.

The factory will produce more than just cars for Tesla. The company recently kicked off another phase of construction work that will include a production workshop and energy center that will eventually focus produce battery packs, according to Reuters.

Shares of Tesla were down 0.86%, or $2.10 a share, at $242.59 in morning trading on Wednesday. They ended Tuesday up 1.59%, or $3.82 a share, at $244.69.

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