Tesla's stock spikes after China loan report
December 23, 2019
Tesla shares hit the $420 (€380) mark on Monday, more than a year after CEO Elon Musk had been fined for tweeting he would consider taking the electric carmaker private at that share price.
Tesla's all-time high represents a 125% rebound from its lowest point of $185.16 at the end of May.
Musk returned to the social media platform to celebrate the symbolic mark on Monday.
In 2018, US authorities fined Musk and the company $20 million for misleading investors after he tweeted that he had secured funding to take Tesla private. Regulators claimed that the ensuing market chaos hurt investors because the funding claim was untrue.
Tesla takes new billion dollar loan
On Monday, it was reported that Tesla received new funding in China. Reuters news agency reported that Tesla and a group of Chinese banks settled on a new $1.4 billion five-year loan for Tesla's Shanghai car plant.
The Shanghai factory is Tesla's first manufacturing site outside the United States.
According to Reuters' sources, Tesla will partially use the loan to roll over $500 million in existing debt. The report added that the remaining funds would be used to cover factory expenses and Tesla's operations in China.
The Chinese banks backing Tesla are the China Construction Bank, the Agricultural Bank of China, the Industrial and Commercial Bank of China and Shanghai Pudong Development Bank. The banks and Tesla have not commented on the loan.
The loan's interest rate will reportedly be set at 90% of China's one-year benchmark interest rate, the best rate available for clients.
Tesla is hoping the plant will increase sales in China and avoid higher import tariffs imposed on cars manufactured in the United States. Tesla's Shanghai project, which has the backing of the local government, would be the country's first wholly foreign-owned car factory.
Read more: German family gets into gear for Tesla Gigafactory
Tesla's Germany project
Last month, German media reported Tesla's plans to invest €4 billion in a new factory in the town of Grünheide, near Berlin. The "Gigafactory" would be Tesla's first European car and battery plant.
According to German news agency DPA, around 3,000 people could be employed at the factory, with a further 5,000 staff employed after an expansion.
Construction on the "Gigafactory" is expected to begin in the first months of 2020.
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