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.

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) - Get Report

, 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.

This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.