Tesla's Gigafactory in China Could Be Done in May
Apparently, Tesla's (TSLA - Get Report) Gigafactory 3 could be completed as early as this May. However, that does not mean it will be operational before summer.
That's according to a Shanghai City official, now that construction is well under way after Tesla broke ground on the factory back in January. To bears' dismay, though, Model 3 production in the new factory is still expected to begin before the end of the year, as it will still take some time to get the production line up and running.
Shares of Tesla climbed throughout the day and closed up about 2.7% to $284.14 on Friday.
Of course the news out of China is a positive sign, while it's also reassuring about the financing. Tesla recently signed an agreement for a $521 million credit facility from Chinese lenders to finance the operation in Shanghai.
Although it's an additional strain on the balance sheet, it means that CEO Elon Musk's cost outlook for the factory hasn't doubled or tripled from his original outlook. That's unlike prior build estimates and inaccurate forecasts. As we've said, though, Musk is getting better with his prediction accuracy. Tesla keeping costs down will be pivotal to its financial health, particularly over the next several quarters as the company works off the large $920 million convertible debt payment.
It's also likely helping that the company's importing issues with the Model 3 into China are being taken care of. Originally, regulators weren't too welcoming of the Model 3 because of some labeling issues. Why this was seemingly made into a bigger deal than it really is -- regulators have since worked with the automaker on a solution and has said that the labels can be applied at the port -- isn't really clear, other than the fact that Tesla is an intense battleground stock.
此外，这也可能有助于该公司解决Model 3在中国的进口问题。最初，由于一些标签问题，监管机构对Model 3并不太欢迎。这看起来有点小题大做，目前尚不清楚具体原因。自那以来，监管机构一直在与特斯拉商讨解决方案，并表示这些标签可以在港口使用。
Bears and bulls constantly trade jabs in the highly emotional name, and after a ~15.5% drop in just a few days, bulls are apparently ready to play defense. The question will now be whether they can rally the stock back toward $300 and if they can get Tesla stock out of the nasty downtrend funk it's in currently.
The news from China is encouraging and should help Tesla's cause, although the depressing post-earnings result from Nio ( NIO) , the Chinese electric auto manufacturer, certainly isn't doing any favors.
While Tesla is looking to become the first wholly-owned foreign automaker producing vehicles in China, it is getting started at a difficult time. While the ongoing trade saga between the U.S. and China has hurt the automaker, its hope is to bypass those headaches by producing within the country.
However, the trade war has also dealt a blow to the Chinese economy and auto industry. Coupled with changing tax rebates from the Chinese government on electric vehicles, the fear is that waning demand will hurt Tesla. Should the trade war get resolved, though, perhaps it will provide the Chinese economy -- and therefore Tesla -- with a much-needed spark.
Gordon Gekko12 hours ago
Done in May? Wow. 2019 will be a decent year for Tesla, but with this factory being up and running, 2020 will be their best year so far. They will be cranking out the 3 and the Y.
5月就完工?2019年对特斯拉来说将是个好年头，随着这家工厂的投产，2020年将是特斯拉迄今为止表现最好的一年。他们会在中国工厂生产Module 3和Module Y。
scdad079 hours ago
Auto assembly plant used to take 3-5 years (toyota in Mexico).
Wait and see.
Dyslexic Shane KO bullies!!11 hours ago
Keep job in America. Not cool
Dana white8 hours ago
Tesla is Done
Alex10 hours ago
Could be done in May and might produce 1st car in December....
Gary Gaunnac4 hours ago
Tariff it at 500 percent for import to the US.
Thomas2 days ago
In other news, Tesla's Gigafactory could be falling apart by July... See Youtube on Chinese construction that goes up quick
zho6 hours ago
Oratusphere9 hours ago
More resources and money for China to build islands with
ChrisA7 hours ago
Not buying a Chinese made car and stay away from Huawei.
NikolaZ4 hours ago
tesla could be done in may
Matt2 days ago
I wouldn't trust a Chinese company assembling.
Dan5 hours ago
So, how long before this wonderful new US automobile company moves all it manufacturing and jobs out of the U.S.? Just another billionaire only caring about making more billions of dollars.
SAM D6 hours ago
Your tax $ at work.
Hamilton9 hours ago
So by June it will be nationalized.
Maki5 hours ago
Quick to build quick to falter. As expected by a Chinaman quality. America is the only country that makes the best products.
AJ7 hours ago
Yet there are still people who can’t accept the obvious fact that Elon is moving, not expanding, his company to China.
MFWIC7 hours ago
Maybe the factory will be built by May, but installing the machinery, and programming the machines and calibration can take up to 1 year for the line to operate full capacity.
Patrick11 hours ago
They should be able to make that for 10k in china
Common humanity Global citizen6 hours ago
A country that allows her most precious technological treasures to be freely thrown away...... Handed to enemies for short term profit.
Jone Doe JR2 hours ago
Brilliant move Tesla...china now has all your intellectual property
davidl5 hours ago
Cost overrun and construction delay rarely happen in China!
USAWINS3 hours ago
Gigafactory in China after building Tesla on the US taxpayers dime! Never drive a Tesla!
APX9 hours ago
China will be pooping out $100 model 3s in a few months
DESMOND4 hours ago
When American plants are up and running, including Tesla, China would have instituted a new law to shut them down if their products for the Chinese market are of substantially lower quality than their home markets. These have been the kind of dirty stuff and tricks the Americans used for the Chinese market. It has been going on for decades.
ForThePeople50 minutes ago
Tesla hater trolls are getting very desperate putting out lies. Looks like Putin, Big Oil, OPEC and NADA are pumping more money out there. Looks like they see this as a last chance.
kevin9 hours ago
They haven’t even started building yet! How the heck are the finished in May? This is nonsense.
Joe10 hours ago
So much for "America's first". How's that MAGA working out so far trumptards?
lewis3 hours ago
Chinese products are of poor quality, fall apart rapidly.