German politicians on Wednesday welcomed the decision of U.S. electric carmaker Tesla to build a factory near the city of Berlin by 2021.

German Minister for Economic Affairs and Energy Peter Altmaier said Tesla's decision would be a "further proof of the attractiveness of Germany as an automotive location."

Tesla CEO Elon Mask announced the decision for a German Gigafactory on Tuesday. The factory would be built near Berlin's new airport and would initially produce the upcoming compact SUV Model Y as well as batteries and drives.

Ferdinand Dudenhoeffer, founder and director of the Center for Automotive Research at the University of Duisburg-Essen told Xinhua that although conditions such as available space, land and energy prices, infrastructure as well as EU subsidies would be important factors for battery cell production, the choice of Berlin would also be a powerful statement which was a "fit for a premium brand such as Tesla".

Tesla's planned factory would create about 6,000 to 7,000 new jobs that were "currently under discussion", Ramona Pop of Germany's green party in Berlin told the German radio station RBB.

Altmaier concluded that the construction of the factory in Germany would be a "milestone in the expansion of electric mobility and battery competence."

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