The US giant will make its Model 3 sedans at the factory - initially targeting 3,000 cars a week before ramping up annual production to 500,000 - which it plans to have operational by the end of the year. Although the exact number can not be released, Tesla said that its sales in China in the first two months of this year have more than doubled from the same period last year.
In the same filing, Tesla amends its ABL credit pact to increase revolving commitments by $500M to $2.425B, allow up to $200M in additional commitments, and extend the term of most of the total commitments to 2023.
"Another reason for terminating the Shanghai factory plan is that the Chinese government this year introduced some new policies to encourage vehicle manufacturers and research and development institutions to further develop vehicles through cooperation", Xie said. Guests look at a Tesla Model 3 during a ground-breaking ceremony for a Tesla factory in Shanghai on January 7, 2019.
Another source at a rival EV company also alluded to the government's influence on the fate of Nio's plant.
The Chinese electric vehicle startup Nio has abandoned its plans to build its own plant in Shanghai.
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.
But Tesla said in a note to China Daily that it is not its intention to compete with companies such as Nio or Byton, as their products vary from each other. In the meanwhile, locally sourced funding is coming nicely together; a Dollars 521 million credit line agreement is closed between the United States company and a syndicate of Chinese investors. Nio previously hoped to finish construction of its own site in Shanghai's Jiading District by the end of 2020.
Musk's Twitter habit has already cost the CEO and Tesla $40 million in fines and forced Musk to give up his role as chairman in a settlement with the Securities and Exchange Commission over the tweets about taking the company private. While preparing this report, the Tesla shares were down by 1.3 percent at $281.73.