A German court has ruled that clearing of trees from the site of Tesla’s first electric car factory in Europe can go ahead, days after it issued an injunction temporarily halting the preparatory work.

The top administrative court in the Berlin-Brandenburg region ruled on Thursday that authorities had been within their rights to clear the way for work to start.

The court had issued an injunction last weekend to give it time to consider the case after an environmental group challenged a lower court’s ruling that Tesla could proceed with felling 92 hectares (227 acres) of pine trees at the site in Grünheide, 24 miles (38km) east of Berlin. Final planning approval for the factory has yet to be granted.

The company wants to start manufacturing 150,000 electric cars a year from mid-2021, with plans to increase that number to half a million annually.

The California-based carmaker announced in November that it had decided to build its first European factory in the Berlin area. The planned site is at Grünheide, just east of the capital in Brandenburg state.

Germany’s main business lobby group, the Federation of German Industries, welcomed the latest court decision on Friday. Holger Lösch, a senior official with the group, described it as “an important signal for Germany as a site for investment”.

He called for a wider discussion about planning and approval procedures in Germany, “which over the years have developed into a serious impediment to investment”.