- By Chuck Squatriglia
Tesla Motors is preparing an initial public offering it hopes will raise as much as $100 million.
The company announced Friday that it has filed the Form S-1 registration statement with the Securities and Exchange Commission for the proposed public offering. The form says the stock would be issued “as soon as practicable.”
Tesla spokesman Ricardo Reyes declined to comment.
The announcement, widely anticipated and frequently rumored, comes just a week after the Department of Energy closed a $465 million loan to help the Silicon Valley automaker build the Model S sedan (pictured). The company has put 937 Roadsters in driveways since starting production two years ago, but that hasn’t kept it from losing money.
A lot of money.
The SEC filing provides the first clear look at the company’s finances. It notes that Tesla has lost “approximately $236.4 million from our inception through Sept. 30, 2009″ and said profitability depends upon successfully producing “automobiles such as the Model S” and growing public interest in electric vehicles.
Most of the major automakers are developing electric vehicles and plug-in hybrids, but Tesla has had the field to itself as the only company mass-producing a highway-legal EV. That field will grow a little more crowded later this year, when General Motors and Nissan begin selling the Chevrolet Volt and Nissan Leaf, respectively.
The Roadster retails for $109,000 before the $7,500 federal EV tax credit, and the souped-up Roadster Sport starts at $128,500 before the credit. The company has sold 937 cars and had $106.5 million in cash at the end of September. Tesla posted its first profit in July, marking the first time it had been in the black since its founding in 2003.
The company has teetered on the brink of financial ruin in the past, but it has always squeaked through. Tesla got a $50 million infusion in May when Daimler bought a 10 percent stake in the company.Speculation of an initial public offering ramped up in November, but the company has largely kept mum about its finances and plans.
According to the SEC filing, half of the proceeds from the IPO would have to fund a dedicated account toward the production cost of the powertrain in the Model S and the facilities to build the car, if the company is to be eligible to draw on all of its Department of Energy Loan. The statement says Tesla will need every last cent of the $465 million the feds are putting up to build the car.
Tesla hasn’t said where it will build the Model S, but all signs point toward an old television and film production facility in the Los Angeles suburb of Downey. Tesla says the Model S will see production in 2012 and — interestingly — the Roadster will cease production in 2011. It won’t be back until at least one year after the S starts rolling off the line. (Read more about that here.)
And speaking of the Roadster, the SEC filing contains an intriguing detail regarding its profitability: In the financial data summary Tesla says it had a profit margin of 8 percent — not anemic but not good. However, that entire margin seems dependent on zero-emission-vehicle credits, which will not be available by the time the Model S is commercially available.
Since the Roadster was arguably unprofitable even at a drive-away price of between $125,000 and $140,000, it would seem that some unspecified efficiencies would have to be part of the success story for a vehicle with an MSRP touted to be half that — $57,000 before the federal tax credit.
Wired.com New York Bureau Chief John C Abell contributed to this report
Photo: Jim Merithew
Wired
