A new report states that Tesla is securing $2 billion in loans from several Chinese banks and funds to finance the accelerated construction of Gigafactory 3 in Shanghai.

Ever since reaching a deal with the local Shanghai government to build the major electric vehicle factory there, CEO Elon Musk has been saying that they plan to finance the effort through local bank loans.

According to a new report from research firm JL Warren Capital, Tesla has now reached deals with several banks:

Shanghai Pudong Development Bank

Industrial and Commercial Bank of China

China Construction Bank

Agricultural Bank of China.

CNBC reported on the new JL Warren Capital research:

“According to JL Warren, which also tracks Chinese companies listed in the U.S., about $500 million (3.3 billion RMB) of Tesla’s new financing should apply to the first stage of the Shanghai Gigafactory build, with the total project loan amounting to about $2 billion.”

During Tesla’s last earnings call, Musk said that the company could get to a production rate of 3,000 cars per week at Gigafactory 3 with just $500 million.

The CEO also said that they were getting a competitive rate for that loan:

“Yes. I mean, as a ballpark figure, probably it’s something in the order of $0.5 billion in CapEx to get to the 3,000 vehicle rates in Shanghai, ballpark figure. And as Deepak was saying, moving up it’s very competitive debt financing in China, really extremely compelling interest rates, and we do not expect that to be a capital drain on the company.”

JL Warren’s report said that the first leg of financing will likely have a 3.9 percent interest.

As we reported earlier this week, a Tesla Gigafactory 3 drone video update shows that they preparing foundation to start building the plant.

Musk previously said that the actual Gigafactory 3 building could be ready this summer and they would start production of “some parts of Model 3 production” by the end of 2019.

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