How Much Money Does Tesla Lose per Model-S?



Tesla losing money

Previously, we noted that Tesla’s (TSLA) revenues have grown significantly over the last couple of years. However, its losses have also widened over this period. Tesla’s net loss rose to $294 million in 2014—a sevenfold increase over the previous year. So far in 2015, Tesla’s net loss has increased further to $338 million.

According to Reuters, Tesla lost $4,000 per Model-S in 2Q15. The calculation is based on Tesla’s reported operating loss in the quarter. Interestingly, while Tesla posted record losses in the quarter, other automakers experienced record gains—at least in the US market (SPY) (VTI).

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Other automakers are posting record profits

Ford’s North American operations posted pretax profits of ~$2.6 billion in 2Q15, as can be seen in the chart above. This is the highest ever profit posted by Ford in North America. The automobile industry in North America has shown strength for the last several quarters. Ford’s North American operations have been profitable since 2010.

General Motors’ (GM) North American operations also posted a record adjusted EBIT (earnings before interest and taxes) of $2.8 billion in 2Q15 at a margin of 10.5%.

Cash flows

Ford’s automotive operations posted strong operating cash flows of $1.9 billion in 2Q15. Ford ended 2Q15 with gross cash of $20.7 billion, while General Motors generated net cash of $5.1 billion in 2Q15.

Although Tesla posted negative operating cash flows of -$159 million in 2Q15, its financials might not be strictly comparable to those of established automakers. We’ll discuss more on this in the next part of the series.


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