Tesla's manufacturing plant in Shanghai is the company's first outside the United States and is China's first wholly foreign-owned car plant.
U.S. electric automobile manufacturer Tesla has secured loans totaling 9 billion yuan ($1.29 billion) from a number of Chinese banks, according to a regulatory filing on Thursday.
The loan will be used to fund its China operations, which include production and operations of its Shanghai «Gigafactory,» the firm said. Part of the loan may also be used to repay the a 3.5 billion yuan debt due on March 4 2020, the filing said.
The firm also signed agreements for an unsecured revolving loan facility of up to RMB 2.25 billion, the statement said. According to the filing, the lenders are China Construction Bank, Agricultural Bank of China, Shanghai Pudong Development Bank, and Industrial and Commercial Bank of China.
Market Competition
Production at the Gigafactory, which is used to produce battery cells and its Model Y and Model 3 electric sedan, began in January.
A slew of carmakers, both local and foreign, are competing for a slice of the electric car market in China, the largest manufacturer and buyer of electric vehicles in the world. However, the country's auto market – including new energy/electric vehicles – is in a slump, with the government cutting back on subsidies and a slowing economy.
The China-built Model 3s are about 8,000 yuan cheaper than imported models, but Tesla said domestic production could slash prices by up to 20 percent (behind firewall) by mid-2020.
