Tesla secures $565 million loan for Shanghai factory

Electric automaker Tesla Inc has reached an agreement for a working capital loan of up to 4 billion yuan ($565.51 million) with a lender from China for its Shanghai auto plant, a regulatory filing showed on Friday.

The loan, which will be given by Industrial and Commercial Bank of China Limited, will be used only for expenses related to production at the Shanghai plant, the filing noted.

Tesla reportedly halted car production at the Chinese plant on 7 May.

The factory is Tesla’s first auto manufacturing site outside the US and is the centerpiece of its ambitions to increase sales in the world’s biggest auto market and to avoid higher import tariffs enforced on U.S.-made cars.

Tesla had suspended production at its San Francisco Bay Area plant because of the broader impact of the coronavirus, and was told by the local county health department on Friday that it should not reopen as local lockdown measures remain in effect.