Tesla investors sue Musk for his ‘misstatements’ on Twitter

Tesla investors sue Musk for his ‘misstatements’ on Twitter

Electric carmaker Tesla has won US$521 million (S$708.4 million) in loans from Chinese banks to build its first overseas plant near Shanghai, making it the first foreign automaker to wholly own a factory in China.

Tesla's China borrowing follows its biggest ever debt payment recently.

Four banks - China Construction Bank Corporation, Agricultural Bank of China, Industrial and Commercial Bank of China and Shanghai Pudong Development Bank - are lending 3.5bn renminbi (£400m) for the project.

"The shift to sales online and other ongoing cost efficient policies will enable the company to lower all vehicle prices by 6 percent on average", Tesla said.

Ground-breaking work on the Shanghai gigafactory started in January and Mr Musk has said he wants the plant to begin production.

More importantly, building its vehicle in China will help US -based Tesla avoid steep import tariffs, so its vehicle can be sold for less and be more competitive.

According to a filing by Tesla, as much as $520M in loans have been committed by Chinese banks.

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It also includes access to the music streaming service YouTube Music which is obviously competing against the incumbent Spotify. Meaning, if you ever paid for premium access in the past, or availed free premium trial, you won't be eligible for the offer.

Tesla will make its Model 3 sedans at the factory, initially targeting 3,000 cars a week before ramping up annual production to 500,000.

Chinese electric vehicle start-up NIO has abandoned plans to build a manufacturing plant in Shanghai after net losses doubled to $1.4 billion a year ago.

Retail sales of sedans, sport utility vehicles, multi-purpose vehicles and minivans fell 18.5% to 1.19 million units last month, according to the China Passenger Car Association Friday.

China is the world's biggest vehicle market.

Cost control will also help the U.S auto maker to face the domestic competition coming from electric vehicle startups such as Nio Inc, Byton and XPeng Motors.

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.

Tesla has said the Gigafactory will cost around $2 billion, and could help the company buffer against the ongoing trade war between the United States and China.

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