Tesla Raises Warehouse Loan Agreement By $500 Million
According to The Street, Tesla has upped one of its warehouse loan agreements.
The Street points out that warehouse loans agreements are used to help finance inventory. According to last week’s SEC filing, Tesla has increased its credit line with Deutsche Bank to $1.1 billion, from a previous $600 million.
This is surely not the first time Tesla has increased its borrowing capacity. In fact, the automaker has done so several times recently, all related to the Model 3.
This is one of a few times now that the company has upped capacities even after CEO Elon Musk said there would be no need to do so. And then, four months later, Tesla increased its credit line further. In addition to all of this, the automaker raised about $1.8 billion in a recent junk bond sale, which was said to be utilized for the scaling of Model 3 production, among other things.
We don’t have any official details as to exactly what the additional funds may be earmarked for. However, Reuters reported that the company has said the money will be used to fund its lease program.
Tesla’s quarterly spending is increasing exponentially with Model 3 production and is expected to skyrocket in 2018. Nonetheless, the automaker’s cash situation is currently about as robust as it has ever been. Until the Model 3 ramp up hits high volume, we can expect that the company will be concerned about the impending cash burn and looking to insulate itself from any unforeseen hiccups.
Meanwhile, Tesla is working diligently to forever expand its global Supercharger network, has now started adding urban Superchargers, continues to expand the Gigafactory in Nevada, and is focusing a significant amount of energy and capital into its solar “Gigafactory 2” in Buffalo, NY.