When Tesla announced its Gigafactory 3 in China earlier this summer, there was a big question mark around the financing for the massive new factory.

CEO Elon Musk has since confirmed that they plan to borrow money from local lenders and it looks like they already raised their registered capital to around $680 million according to local media reports, but there’s still a lot more to go.

During Tesla’s last earnings call, Musk said about the cost of the new factory:

“So with respect to Gigafactory CapEx, I think we learned a tremendous amount with Gigafactory 1, and we’re confident that we can do the Gigafactory in China for a lot less. I think it’s probably closer to, this is just a guess, but probably closer to $2 billion, and that would be sort of at the 250,000 vehicle per year rate.”

To be clear, that would only be sort of the “first phase” of the Gigafactory 3 in China.

It wouldn’t include battery cell production, which Tesla would like to add, and the company ultimately wants a capacity of 500,000 cars per year at the plant, not 250,000.

But now, even for just the first phase, Tesla sees a need for about $2 billion.

Reports from China started coming out this weekend that Tesla updated its subsidiary Tesla (Shanghai) Co information with the Shanghai Administration for Industry and Commerce.

They increased the registered capital from 100 million yuan to 4.67 billion yuan ($680 million USD) and they “expanded the scope” of what the subsidiary is involved in to include manufacturing.

Update: while the Bejing Business daily reports that the funds are now “in place”, the step to increase the registered capital might only be to prepare for the cash injection.

Bejing Business Daily reported:

“At the same time, the Beijing Business Daily reporter found that with the injection of funds, the company’s business scope has also expanded to the production, sales and maintenance of new electric vehicles and parts, new battery separators, battery management systems, electric vehicle drive motors, Manufacturing of key components for new energy vehicles such as high-power electronic devices. The expansion of this business scope means that Tesla Shanghai is no longer just a technology company, and has begun to really get involved in new energy vehicle manufacturing.”

It’s still only a fraction of the amount of money that it needs, but it should be enough to get things moving.

We reported last month that Tesla started hiring for Gigafactory 3 in China.

In terms of a timeline, the automaker said that it expects “construction to begin in the near future” and that it “will take roughly two years” until they start producing vehicles and “then another two to three years before the factory is fully ramped up to produce around 500,000 vehicles per year for Chinese customers.”

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