Tesla's liquidity has increased and it is ready to mortgage the production of Model 3's factory.

Due to the fact that the company has not yet achieved profitability in the 15 years since its founding, Tesla, the senior electric vehicle manufacturer in the United States, has received much attention. Recently, some analysts said that Tesla now consumes $6,500 per minute. If there is no additional financing this year, The company may be difficult to support until 2019.

On May 8, according to the latest news from Reuters, Tesla has changed the terms of the loan agreement with the bank to allow it to use the Fremont car factory in the United States as collateral. Some analysts believe this. It is to stabilize the company's liquidity.

According to a regulatory filing submitted by Tesla on Monday, the electric vehicle manufacturer has only $543 million in the $1.8 billion line of credit available, and the bank will check to see if they are willing to lend. The amount that is paid out.

“Although the specific reasons for Tesla’s move are still unclear, we suspect that with the upcoming massive cash consumption in 2018, the bank has asked Tesla to provide additional guarantees to maintain its $1.8 billion. Loans." Research firm Credit Sights analysts said in a report, "Banks are also trying to protect themselves."

According to Reuters quoted insiders, the amendment was not from the bank's requirements, but was decided by Tesla.

There is no doubt that the Fremont factory is a valuable asset that Tesla is currently able to offer to banks as a collateral. The Tesla plant in California, USA, covers an area of ??5.3 million square feet, while at the same time producing the model 3 of the compact car for the mass market, which is seen as the key to Tesla's profitability.

Tesla is "difficult" to increase the capacity of the Model 3 model. In early April, in order to enhance investor confidence, Tesla emphasized that Model 3 doubled its production capacity in the first quarter of this year. It is expected to produce 5,000 units per week in the second quarter, with an annual production capacity of 250,000 units. At the end of the first quarter, the actual single-week production of Model 3 reached 2020. Although it broke through 2,000 units, it still fell short of the company's previous forecast of 2,500 units per week.

“Tesla will continue to burn money in the next few years,” said Scott Roberts, head of high-yield investment at Invesco, an investment firm.

After several consecutive quarters of losses, Tesla CEO Elon Musk promised investors that the company will turn around in the third quarter. At the same time, he also stressed that Tesla does not need additional financing, but this statement clearly does not "take credit" on Wall Street, most investors and analysts believe that Tesla will raise more funds before the end of this year.

Currently, Tesla's capital structure includes convertible bonds, junk bonds and bank credit. CreditSights said that in the case of the company's assets, in fact, can make some other choices.

Previously, Tesla signed a credit agreement with nine banks led by Deutsche Bank, with accounts receivable, inventory and equipment as collateral, while Tesla could provide other valuable assets, such as Nevada. Gigafactory factory or its intellectual property to get extra cash.

In fact, a new round of financing can be costly. Last year, Tesla sold $1.8 billion worth of junk bonds to help model 3 mass production. But today, the bond price plummeted, only 87% of the face value, with a yield of 7.7%.

“Seeing that high-value assets such as the Fremont factory are mortgaged may make investors more cautious.” Credit Sights said, “The more assets that are dragged down, the more problems will arise.”

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