AutoBeta(AutoBeta.net)03/08 Report--

Tesla, the US electric car company, has built its sprawling battery and car factory in Shanghai, China, applying for low-interest loans from Chinese banks as a source of funding for the plant.

Tesla confirmed that agreements have been reached with a number of Chinese banks and have received 521 million US dollars (3.5 billion yuan) in loans to build car and battery factories in China.

The Shanghai Super Factory, Tesla's first overseas factory, can realize the production of Model 3 cars by the end of this year at the earliest, and the agreement reached with Chinese banks will also boost Tesla's model 3 production.

Chen Mingbo, a deputy to the National people's Congress, said on March 6 that the Tesla project is the largest foreign investment in the manufacturing industry in Shanghai in history. It only took half a year from signing the contract to winning the land to start construction. It is expected that the construction of the final assembly workshop will be completed in May this year, and some production lines will be officially put into production by the end of the year. Tesla CEO Musk also expects to start production of batteries and Model 3 by the end of the year.

Banks, including China Construction Bank, Agricultural Bank of China, Industrial and Commercial Bank of China and Shanghai Pudong Development Bank, will jointly provide 12-month loans to the Shanghai superfactory in batches of up to 3.5 billion yuan, Tesla said. Tesla also revised a separate asset-backed credit agreement to increase the borrowing line by up to $700m.

Musk also said the plant produces up to 3000 Model 3s a week.

The localization of Tesla's production has reduced the production cost of Model 3, as well as the price in the Chinese market. The domestic price of Model 3 will be less than 300000, which will deal a blow to many domestic electric car companies.

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