Tesla Motors

Topics: Electric car, Tesla Motors, Lithium-ion battery Pages: 13 (860 words) Published: February 10, 2015
Tesla Motors – Company Profile
By Kevin Jarosz
IE-618 Fall 2014

Financial Impact
• Tesla will pay for this by taking a cut of the apps.
• Tesla will take a 30%of the cost

Assuming each Tesla owner downloads 5 apps the first year at an

average price of $10, that is approximately $6M in revenue in 2015 of which Tesla gets $1.8M to pay.

• In Q2 2014 Tesla reported their vehicle margin was 26.9% on a GAAP basis, and it is clear that apps will only increase vehicle margin.
• Owners will be buying apps for the entire time they own the vehicle (Americans on average tend to keep new vehicles for almost 6 years), a Tesla could allow transfer of apps from vehicle to vehicle creating a new form of 'lock-in.'

Financial Impact
Tesla is uniquely positioned to lead in this area given that all cars since 2012 have shipped with the ability to be updated, have dedicated 3G and Wi-Fi connections, and have acres
of screen real estate to exploit.

Return of Investment

The costs for this can add up. There's no such thing as a "typical" app, so it's hard to give a meaningful average cost. But as a general working figure, we can say it costs at least $30,000 to design a brand-quality iPhone app. For enterprise-scale organizations like consumer banks and nationwide retail stores, they have the capital, and the ROI justifies it. But if your budget for mobile is under $100,000, it may not be a good approach.

The Growth of Tesla

Government support is mutually-beneficial
• Today’s Market Cap is estimated at: $30.75B

Tesla Employees:
• Tesla currently employs over 6,000 employees
• This number is expected to double when they open their battery Giga-Factory in Reno, NV in 2017.

According to Gov. Brian Sandoval, Tesla’s new battery factory is projected to have a $100B economic impact to the state of NV over the next 20 years.

Income Statement

A deeper look into Tesla’s Financial Status
• Total Revenue increased fivefold from
CY12 to CY13
• Gross Profit rose from $30M to $456M
Direct Margins
• % of profit Tesla makes on each car
before overhead
• Gross Profit Margin was $456M in CY13
vs only $30M in CY12
Operating Margins
• In CY13 Tesla was operating at a $75M loss
• By year end Tesla turned in it’s first positive

Tesla Motors, Inc. (TSLA)

Traded on the Nasdaq stock index

TSLA – Stock Chart

TSLA is up about %1000
since December of 2012.
Hypothetically, if you
invested $10,000 is TSLA
stock, you would now
have $100,000 less than
2 years later!

Top Executives & Their Salaries

Relatively Small Salaries… Enormous Options Payouts!
Top Executives


Elon Musk

• Chairman of the Board & Chief Executive Officer
• Product Architect

• 2012 - $33,280 plus $6,000 in bonuses*
• 2013 - $33,280 plus $36,709 in bonuses*

Deepak Ahuja
• Chief Financial Officer

Jeffrey Straubel
• Chief Technology Officer

• 2012 - $338,000 plus $563,457 in options
• 2013 - $338,000 plus $1.05M in options
• 2012 - $254,000 plus $563,457 in options
• 2013 - $1.21M plus $2.39M in options

* Elon Musk has the option to buy 5.27 million TSLA shares at $31.17 a share over the next 10 years. With today’s stock price, he would profit approximately $1.153B.

Product Lineup

All electric, high powered, luxury vehicles.

Two Seater Sportscar
• 0 – 60 mph in 3.7 s

Model S

Model X (avail. 2015)

Luxury Sedan

Luxury SUV

• 0 – 60 mph in 5.4 s

• 0 – 60 mph in < 5s

• 245 miles per charge

• 265 miles per charge

• 265 miles per charge

• 0 tailpipe emissions

• 0 tailpipe emissions

• 0 tailpipe emissions
• Seats 7

Product Lineup (cont.)

All electric, high powered, luxury vehicles.
Model 3 (concept)

Entry Level Sedan
• Est. Price ~ $30,000
• 200 miles per charge
• Expected release date 2017


Global Charging Stations
• Currently 115 stations in US
• Complete...
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