Tesla chief executive Elon Musk was in China in January for the groundbreaking of the factory, where he said he planned to approach local banks for the money to get the plant built and into production.
The company unveiled the long-awaited $35,000 version of the Model 3 on February 28 and said the same day it will close most of its stores and shift sales online.
The fresh borrowing follows Tesla's largest-ever debt payment last week. Tesla borrowed US$431 million under the agreement in 2018.
Nio has shelved plans to build a Shanghai factory given the uncertainties in China's EV market this year, and plans to continue making its cars via an original equipment manufacturer.More news: Pakistan's High Commissioner to India returns to his post in New Delhi
According to a filing by Tesla, as much as $520M in loans have been committed by Chinese banks.
The new plant will eventually have an annual production capacity of 500,000 vehicles, the California-based company has said, dramatically increasing its output.
Tesla's lenders of the unsecured loan include China Construction Bank Corp, Agricultural Bank of China, Industrial and Commercial Bank of China and Shanghai Pudong Development Bank Co.
Retail sales of sedans, sport utility vehicles, multi-purpose vehicles and minivans fell 18.5% to 1.19 million units last month, according to the China Passenger Car Association Friday.More news: Trump Super Bowl Party Attended By Founder Of Orchids Of Asia Spa
The change in plans represent a large change in direction for the company which had just started production of its first auto, the ES8 SUV previous year.
China agreed to roll back the tariffs to 15 percent last December after Chinese president Xi Jinping and Donald Trump met at the G20 summit in Argentina for trade negotiations. -China trade war, which has forced Tesla to adjust prices of its US -made cars in China.
Musk has said Tesla plans to start battery and Model 3 production at the factory by the end of the year.
Local manufacturing also will help the company sidestep any re-escalation of trade tensions between the United States and China.More news: Titans reportedly out of race for WR Antonio Brown