Tesla Secures $1.6 Billion Chinese Credit for Its Shanghai Factory
As the whole world has become wary of the developments in the US-China trade war front, finally, there is a positive light on that issue. After choosing China as its first manufacturing unit outside the United States, Tesla has inked a loan agreement worth 9B Yuan (1.29B USD) recently.
As per Tesla’s official confirmation, the 9B Yuan loan facility will be a secured one and along with it, another 2.25B Yuan unsecured loan agreement has also been inked. The company confirmed that both the loan facilities would be used for Tesla’s Shanghai car plant.
As per the loan filing of Tesla, the lenders include China Construction Bank Corp, Agricultural Bank of China, Shanghai Pudong Development Bank and Industrial and Commercial Bank of China.
It should be noted that Tesla is due to pay 3.5B Yuan debt on March 4. It is likely to use the newly got loan for paying the debt along with the expenditure that may be incurred for initial construction and production at the Shanghai unit.
At the onset of the US-China trade war, Tesla went ahead to set up a factory in China to boost electric car sales in the Asia Pacific region. Earlier, Tesla cars were subject to the uniform high tariff from China that led to tough penetration of sales into China, one of the largest car markets of the world.