Tesla secures $1.29 billion loan from Chinese banks for Shanghai factory

 

FILE PHOTO: A China-made Tesla Model 3 electric vehicle is seen ahead of the Guangzhou auto show in Guangzhou, Guangdong province, China November 21, 2019. REUTERS/Yilei Sun/File Photo

 

(Reuters) - Tesla Inc entered into agreements with lenders in China for a secured term loan facility of up to 9 billion yuan ($1.29 billion), according to a regulatory filing on Thursday.

 

The electric car maker said it has also signed agreements for an unsecured revolving loan facility of up to 2.25 billion yuan, adding that both the loans will be used for its Shanghai car plant. (https://bit.ly/2tU35dI)

 

Reuters reported earlier this week that Tesla and a group of China banks had agreed to a new 10 billion yuan, five-year loan facility for the automaker's Shanghai car plant, citing sources familiar with the matter.

 

(Reporting by Ayanti Bera in Bengaluru; Editing by Shounak Dasgupta)

 

 

-- © Copyright Reuters 2019-12-27

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I guess Musk is willing to let his tech get copied for the factory and the loan. He is smart enough so I guess the gamble is he thinks he can sell more real Teslas even if the copies roll out. 

14 minutes ago, Cryingdick said:

I guess Musk is willing to let his tech get copied for the factory and the loan. He is smart enough so I guess the gamble is he thinks he can sell more real Teslas even if the copies roll out. 

The Chinese do not need to copy Musks cars , they make their own already

4 minutes ago, sanemax said:

The Chinese do not need to copy Musks cars , they make their own already

 

Of course the batteries they have are superior. They also make cheap knock off Rolex watches. Even European car makers such as Audi, Mercedes and BMW can't replicate what Tesla does. 

Edited December 26, 20196 yr by Cryingdick

1 hour ago, sanemax said:

The Chinese do not need to copy Musks cars , they make their own already

China would be still a nation a rice farmers in oxen carts if it wasn't for the prolific and systematic government sanctions and encouraged copying, espionage and thefts practices of patented products and intellectual rights know throughout the world...

Says a lot about the state of affairs in the US if a US company has to not only manufacture in China but also borrow the money from there.  Doesn't seem to run parallel to Trumps so called "Make America Great Again" campaign? 

 

I recently watched a very depressing documentary titled American Factory which showed how the economy was so depressed the US Govt was paying the Chinese to set up an auto glass factory in one of the many deserted auto plants in Ohio just to employ a mere fraction of the workers who lost their jobs when the auto industry there failed.  The workers were so desperate they accepted wages less than they were getting when the plant closed down 12 years earlier, receive no overtime penalty rates and have even voted against having a trade union in case it threatens their jobs.

I wonder how Musck will react when he tries to import the manufactured cars into USA and is facing a 150% import tax.  Or maybe he is betting on impeachment removing Trump.

 

In response to other posts - the part of the USA economy that is 'crashing' is the part that operated through importing cheap Chinese made products.  The rest is doing fine.  And many companies are now manufacturing their products in USA that they used to make in China for the USA market.

 

5 hours ago, Cryingdick said:

You mean Pedo guy? I will call the village chief.

He now owns that nickname for life, thanks to himself lol. If I ever see him, I be tempted to scream it.

Edited December 27, 20196 yr by tabarin

3 hours ago, AussieBob18 said:

I wonder how Musck will react when he tries to import the manufactured cars into USA and is facing a 150% import tax.  Or maybe he is betting on impeachment removing Trump.

 

 

 

Musk is moving to China to avoid American tariffs on cars exported to China ( the largest market for electric cars).... this means less revenue for those divided states... this means less jobs for citizens in those divided states... this means cheaper Tesla’s for the Chinese market (cheap stuff for China... way to maga)... this means those divided states are the losers in this matter... trump.... making China great again. Y’all gotta love it.

1 hour ago, jany123 said:

Musk is moving to China to avoid American tariffs on cars exported to China ( the largest market for electric cars).... this means less revenue for those divided states... this means less jobs for citizens in those divided states... this means cheaper Tesla’s for the Chinese market (cheap stuff for China... way to maga)... this means those divided states are the losers in this matter... trump.... making China great again. Y’all gotta love it.

Tariffs may play a role  but the main reason is probably the market size (around half of the current world market) and the high number of rich Chinese looking for a distinctive car.

It's also likely that they can benefit from the presence of a large ecosystem and innovation from state-funded research programs.

1 hour ago, jany123 said:

Musk is moving to China to avoid American tariffs on cars exported to China ( the largest market for electric cars).... this means less revenue for those divided states... this means less jobs for citizens in those divided states... this means cheaper Tesla’s for the Chinese market (cheap stuff for China... way to maga)... this means those divided states are the losers in this matter... trump.... making China great again. Y’all gotta love it.

Tariffs are taxes imposed on Imports - not Exports.  Perhaps you mean to avoid the tariffs China has imposed on USA cars? - which Trump matched months ago and upped the anti - and which most Americans support. USA has a  $400+ billion trade deficit with China and Trump has taken them on - and will win - and it is about time someone did.  

8 minutes ago, candide said:

Tariffs may play a role  but the main reason is probably the market size (around half of the current world market) and the high number of rich Chinese looking for a distinctive car.

It's also likely that they can benefit from the presence of a large ecosystem and innovation from state-funded research programs.

Yep.  Musk is smart enough to know that long-term there is a great market in China for his cars, and that using Chinese money and Govt support to set up manufacture will give him 'protection'.  Musk will still manufacture in USA/Canada/Mexico for those markets, but setting up in China for the SEAsia market is good long term planning.  His sub company Solarcity gets lots of funded support in California, but it is smart to also get that in China.  UK next ?? 

1 hour ago, AussieBob18 said:

Tariffs are taxes imposed on Imports - not Exports.  Perhaps you mean to avoid the tariffs China has imposed on USA cars? - which Trump matched months ago and upped the anti - and which most Americans support. USA has a  $400+ billion trade deficit with China and Trump has taken them on - and will win - and it is about time someone did.  

I’m sorry... my boo boo... retaliatory tariffs... yes.

 

theses tax’s that the trump has imposed... these tariffs that the trump has imposed, has caused Tesla to abandon american manufacturers, in favor of producing at a 35% saving in China. But hey... if y’all purchase a car for 35% less from China, then add american import tariffs, you will get a cheaper car direct from China. So... ???????????? Y’all can thank the trump for cheaper Chinese made cars... maga.

16 hours ago, jany123 said:

I’m sorry... my boo boo... retaliatory tariffs... yes.

 

theses tax’s that the trump has imposed... these tariffs that the trump has imposed, has caused Tesla to abandon american manufacturers, in favor of producing at a 35% saving in China. But hey... if y’all purchase a car for 35% less from China, then add american import tariffs, you will get a cheaper car direct from China. So... ???????????? Y’all can thank the trump for cheaper Chinese made cars... maga.

Not 100% accurate - Tesla is still manufacturing in USA and will continue to do so - for the USA, Canada and Mexican markets - under the recent Trade Agreement completed by Trump. 

On 12/26/2019 at 10:57 PM, Cryingdick said:

I guess Musk is willing to let his tech get copied for the factory and the loan. He is smart enough so I guess the gamble is he thinks he can sell more real Teslas even if the copies roll out. 

There go the patents.

On 12/27/2019 at 1:20 PM, AussieBob18 said:

I wonder how Musck will react when he tries to import the manufactured cars into USA and is facing a 150% import tax.  Or maybe he is betting on impeachment removing Trump.

 

In response to other posts - the part of the USA economy that is 'crashing' is the part that operated through importing cheap Chinese made products.  The rest is doing fine.  And many companies are now manufacturing their products in USA that they used to make in China for the USA market.

 

Nonsense. The manufacturing sector in the USA has taken a big hit thanks to Trump's tariffs:

Fed study finds Trump tariffs backfired

President Donald Trump’s strategy to use import tariffs to protect and boost U.S. manufacturers backfired and led to job losses and higher prices, according to a Federal Reserve study released this week.

“We find that the 2018 tariffs are associated with relative reductions in manufacturing employment and relative increases in producer prices,” concluded Fed economists Aaron Flaaen and Justin Pierce, in an academic paper.

While the tariffs did reduce competition for some industries in the domestic U.S. market, this was more than offset by the effects of rising input costs and retaliatory tariffs, the study found.

https://www.marketwatch.com/story/fed-study-finds-trump-tariffs-backfired-2019-12-27

2 hours ago, AussieBob18 said:

Not 100% accurate - Tesla is still manufacturing in USA and will continue to do so - for the USA, Canada and Mexican markets - under the recent Trade Agreement completed by Trump. 

I don't see what the recently negotiated but not yet ratified by the Senate trade agreement has to do with this issue at all. 

On 12/27/2019 at 8:17 AM, tabarin said:

He now owns that nickname for life, thanks to himself lol. If I ever see him, I be tempted to scream it.

Of course you would hero

1 hour ago, bristolboy said:

Nonsense. The manufacturing sector in the USA has taken a big hit thanks to Trump's tariffs:

Fed study finds Trump tariffs backfired

President Donald Trump’s strategy to use import tariffs to protect and boost U.S. manufacturers backfired and led to job losses and higher prices, according to a Federal Reserve study released this week.

“We find that the 2018 tariffs are associated with relative reductions in manufacturing employment and relative increases in producer prices,” concluded Fed economists Aaron Flaaen and Justin Pierce, in an academic paper.

While the tariffs did reduce competition for some industries in the domestic U.S. market, this was more than offset by the effects of rising input costs and retaliatory tariffs, the study found.

https://www.marketwatch.com/story/fed-study-finds-trump-tariffs-backfired-2019-12-27

I'll see your academic left wing 'paper' and raise you the Dow Jones since 2015

 

And remind you that after Chine was allowed to join the WTO (for unknown very dubious reasons), successive US Governments allowed them to take the jobs of 75,000 US Factories and over 5 million manufacturing jobs.  https://www.wsj.com/articles/president-trumps-trade-policy-is-working-11568138994

The Trump plan is not to seek short term gains in trade/imports/exports - it is to force US companies to return to USA and open factories to make products for the US market in the USA - and it is working. 

Trump is OK for factories in China/Thailand etc to make product for the SEAsian market, but he and the majority of US People hate that US companies went there for profits and that China steals IP and the WTO does nothing about it.

It is the big picture - some see it - some dont.

 

1 hour ago, bristolboy said:

I don't see what the recently negotiated but not yet ratified by the Senate trade agreement has to do with this issue at all. 

Then dont comment on other's conversations

On 12/27/2019 at 1:20 PM, AussieBob18 said:

I wonder how Musck will react when he tries to import the manufactured cars into USA and is facing a 150% import tax.  Or maybe he is betting on impeachment removing Trump.

 

In response to other posts - the part of the USA economy that is 'crashing' is the part that operated through importing cheap Chinese made products.  The rest is doing fine.  And many companies are now manufacturing their products in USA that they used to make in China for the USA market.

 

But can they meet the lower price that the Chinese offered?

42 minutes ago, AussieBob18 said:

Then dont comment on other's conversations

Why should he not comment. This is a forum that we discuss things (within the rules). If you don't like his posts, either don't read them or put him on your ignore list.

 

If you really don't like his post, then report it to the moderators. There is a little box at the top right corner that you can use.

On 12/27/2019 at 1:20 PM, AussieBob18 said:

I wonder how Musck will react when he tries to import the manufactured cars into USA and is facing a 150% import tax.  Or maybe he is betting on impeachment removing Trump.

 

In response to other posts - the part of the USA economy that is 'crashing' is the part that operated through importing cheap Chinese made products.  The rest is doing fine.  And many companies are now manufacturing their products in USA that they used to make in China for the USA market.

 

You mean like Apple, they produce all their iPhones in China and now want to relocate with their iPad production to China? Oh wait, their products are not affected from the high import taxes.

It´s so funny, that the US always complain about the high imports from other countries and blame the countries. But the US companies are to blame. It´s not Chinas fault that they produce in China. 

 

Btw., Musk said that the Chinese Teslas are only for the Chinese market.

1 hour ago, AussieBob18 said:

I'll see your academic left wing 'paper' and raise you the Dow Jones since 2015

 

And remind you that after Chine was allowed to join the WTO (for unknown very dubious reasons), successive US Governments allowed them to take the jobs of 75,000 US Factories and over 5 million manufacturing jobs.  https://www.wsj.com/articles/president-trumps-trade-policy-is-working-11568138994

The Trump plan is not to seek short term gains in trade/imports/exports - it is to force US companies to return to USA and open factories to make products for the US market in the USA - and it is working. 

Trump is OK for factories in China/Thailand etc to make product for the SEAsian market, but he and the majority of US People hate that US companies went there for profits and that China steals IP and the WTO does nothing about it.

It is the big picture - some see it - some dont.

 

You're right about one thing, his plan is not to seek short term gains in imports, trade and exports.

His plan is short term gains on the stock market.

1 hour ago, AussieBob18 said:

I'll see your academic left wing 'paper' and raise you the Dow Jones since 2015

The Dow rises because the lower tax for companies and the companies use the saved money to buy their own stocks. And they spend billions.

 

1 hour ago, AussieBob18 said:

The Trump plan is not to seek short term gains in trade/imports/exports - it is to force US companies to return to USA and open factories to make products for the US market in the USA - and it is working. 

You mean like Apple, they produce ALL of their iPhones in China and wants to relocate the iPad factory to China too?

 

1 hour ago, AussieBob18 said:

It is the big picture - some see it - some dont.

A part of the big picture is, that BMW produces ALL of their X models, except the X1, in the US, where the largest BMW factory in the world is. They export their cars to Europe and all over the world. So they better decrease their factory and produce only for the US market? Should be smart, because they are affected from the customs China now demands on US cars because Trump´s customs of Chinese goods. That´s how the world economy works.  

A troll post and the replies have been removed. 

4 hours ago, AussieBob18 said:

Then dont comment on other's conversations

 

4 hours ago, AussieBob18 said:

I'll see your academic left wing 'paper' and raise you the Dow Jones since 2015

 

And remind you that after Chine was allowed to join the WTO (for unknown very dubious reasons), successive US Governments allowed them to take the jobs of 75,000 US Factories and over 5 million manufacturing jobs.  https://www.wsj.com/articles/president-trumps-trade-policy-is-working-11568138994

The Trump plan is not to seek short term gains in trade/imports/exports - it is to force US companies to return to USA and open factories to make products for the US market in the USA - and it is working. 

Trump is OK for factories in China/Thailand etc to make product for the SEAsian market, but he and the majority of US People hate that US companies went there for profits and that China steals IP and the WTO does nothing about it.

It is the big picture - some see it - some dont.

 

Of course the stock market has risen dramatically under Trump. He slashed taxes on corporations. So that increases dividends.  Also, corporations are using their cash to buy back shares. Fewer shares means higher dividends for the remaining shares which means shares are more in demand. But the fact is that the middle class is largely disinvested from the stock market. The richest are those who profit from it most. 

The Richest 10% of Americans Now Own 84% of All Stocks

The stock market continues to be one of President Donald Trump’s favorite indicators of the country’s health as stocks continue to hit all-time highs.

But a shrinking share of Americans are getting rich off the market’s dizzying rise, according to a new analysis.

The top 10% of American households, as defined by total wealth, now own 84% of all stocks in 2016, according to a recent paper by NYU economist Edward N. Wolff.

https://money.com/stock-ownership-10-percent-richest/

 

And your comments about manufacturing are just nonsense. No, manufacturing is not returning to the U.S. in any meaningful way. If it were, the us negative  balance of payments  in goods should be declining. Instead under Trump it has reached record levels.

https://www.statista.com/chart/17281/us-trade-balance/

 

Also, if manufacturing were increasing as you claim it is, business investment should be rising. Which is what Trump and company claimed would happen in the wake of the tax cuts. In fact, it is falling.

 

Business investment drops 3% in third quarter amid trade war uncertainty

https://www.cnbc.com/2019/10/30/business-investment-drops-3percent-in-third-quarter-amid-trade-war-uncertainty.html

 

But apart from these minor points, I agree with you entirely.

 

10 hours ago, AussieBob18 said:

Not 100% accurate - Tesla is still manufacturing in USA and will continue to do so - for the USA, Canada and Mexican markets - under the recent Trade Agreement completed by Trump. 

6 hours ago, bristolboy said:

I don't see what the recently negotiated but not yet ratified by the Senate trade agreement has to do with this issue at all. 

 

5 hours ago, AussieBob18 said:

Then dont comment on other's conversations

Let me make what seems to be an obvious point a little clearer to you. The new trade agreement which replaces NAFTA will make virtually no difference in regard to Tesla's market in North America. That Tesla will be manufacturing autos in China will make a big difference to the market outside North American for the products of Tesla manufactured in North America. And not in a good way. At least as far as Tesla's American workers are concerned. It should be great for Tesla's shareholders though.

 

 

Yes, the Dow Jones Index has risen, but even Trump's self serving policies wouldn't have had such a dramatic effect if not built on the previous period of optimism and growth.  Looking back to 1980, it's quite apparent which presidents oversaw the biggest periods of sustained growth.  And, if you believe that the strength of the DJI equates to the strength of the US - as Trump supporters keep telling us is the case, it certainly reveals the lie that Democrat presidents are bad for the US.  So, which is it guys?  Either eat the cake or lock it up in the cupboard, you can't have it both ways.

 

 

What

8 minutes ago, ballpoint said:

Yes, the Dow Jones Index has risen, but even Trump's self serving policies wouldn't have had such a dramatic effect if not built on the previous period of optimism and growth.  Looking back to 1980, it's quite apparent which presidents oversaw the biggest periods of sustained growth.  And, if you believe that the strength of the DJI equates to the strength of the US - as Trump supporters keep telling us is the case, it certainly reveals the lie that Democrat presidents are bad for the US.  So, which is it guys?  Either eat the cake or lock it up in the cupboard, you can't have it both ways.

 

 

Whatever the historical precedents, the fact is that huge tax cuts on corporations increased dividends. Also, corporations spent huge amounts on stock buybacks which increased the value of remaining shares. Also the Fed has recently cut interest rates again, which makes stocks a more appealinig investment.

None of these factors has anything to do with the general health of the economy.