The loans from China Construction Bank Corp., Agricultural Bank of China Ltd., Industrial & Commercial Bank of China Ltd. and Shanghai Pudong Development Bank Co. mature in March 2020, according to a regulatory filing. Tesla also amended a separate asset-backed credit agreement, increasing how much it can borrow by as much as $700 million.
The fresh borrowing follows Tesla’s largest-ever debt payment last week. Settling the $920-million convertible bond that matured March 1 taxed the company’s balance sheet, which had about $3.7 billion in cash and equivalents at year-end. After years of negotiations with Chinese authorities to become the first foreign automaker to wholly own a manufacturing facility in the country, Tesla broke ground on the outskirts of Shanghai on Jan. 7. Musk has said the company plans to start battery and Model 3 production at the factory by the end of the year.
Tesla can now do so by borrowing at favorable rates. The yuan-denominated loans accrue interest at a rate equal to 90% of the one-year rate published by the People’s Bank of China. For dollar-denominated loans, the rate is 1% more than Libor. Beginning local production in China is key for Tesla to reduce the costs of its cars in what is the world’s largest market for electric vehicles. Battery-powered autos have been a rare bright spot amid the broader market’s slowdown. Local manufacturing also will help the company sidestep any re-escalation of trade tensions between the U.S. and China.
Source: Loan News Today (loannewstoday.net)
Should be a 20k car. Well, with 39 cent an hour labor rate.
With the move to China I hope the price of Teslas is going to drop as well!!!! $$$$
With the move to China I hope the price of Tesla's is going to drop as well!!!! $$$$
Nothing is made in United States anymore. In the future most Americans will be without jobs and homeless. Tesla had performance reviews a while ago showing negative results in it's American factories. So Sad 😥!!!
And the Chinese will steal the technology.
Soon there will be majority electric cars on the road. A win for humans who can breathe better and a cleaner earth. Hope China make millions of them an also invest billions in renewable energy.
Gross. These should have been made here.
Short sighting. Soon there will be a Tesla looking car but with a Chinese name.
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