Editing Tesla, Inc.
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|date=November 11, 2014 | |date=November 11, 2014 | ||
|access-date=October 3, 2018 |website=Business Insider}}</ref><ref>{{cite web |title=Tesla Energy Generation And Storage Business: Q4 2020 Results |url=https://insideevs.com/news/482496/tesla-energy-generation-storage-q4-2020-results/ | date=January 27, 2021}}</ref><ref>{{cite web |title=Elon Musk |url=https://www.forbes.com/profile/elon-musk/ |website=[[Forbes]]}}</ref><ref>{{cite web | url=https://www.sec.gov/Archives/edgar/data/1318605/000156459021044307/tsla-pre14a_20210813.htm | title=Schedule 14A Information | publisher=[[U.S. Securities and Exchange Commission]]}}</ref><ref name="10K_2022">{{cite web |title=Annual report Form 10-K 2022 Tesla Inc. |url=https://www.sec.gov/ix?doc=/Archives/edgar/data/1318605/000095017023001409/tsla-20221231.htm |date=January 31, 2023 |publisher=[[U.S. Securities and Exchange Commission]]}}</ref> | |access-date=October 3, 2018 |website=Business Insider}}</ref><ref>{{cite web |title=Tesla Energy Generation And Storage Business: Q4 2020 Results |url=https://insideevs.com/news/482496/tesla-energy-generation-storage-q4-2020-results/ | date=January 27, 2021}}</ref><ref>{{cite web |title=Elon Musk |url=https://www.forbes.com/profile/elon-musk/ |website=[[Forbes]]}}</ref><ref>{{cite web | url=https://www.sec.gov/Archives/edgar/data/1318605/000156459021044307/tsla-pre14a_20210813.htm | title=Schedule 14A Information | publisher=[[U.S. Securities and Exchange Commission]]}}</ref><ref name="10K_2022">{{cite web |title=Annual report Form 10-K 2022 Tesla Inc. |url=https://www.sec.gov/ix?doc=/Archives/edgar/data/1318605/000095017023001409/tsla-20221231.htm |date=January 31, 2023 |publisher=[[U.S. Securities and Exchange Commission]]}}</ref> | ||
}} | }}Tesla is on a mission to accelerate the world's transition to sustainable energy.<ref name=":3">https://www.tesla.com/about</ref> | ||
The company sells and leases high-performance fully electric vehicles and energy generation and storage systems, and offers services related to its products. Tesla emphasises performance, attractive styling and the safety of its users in the design and manufacture of its products and is continuing to develop full self-driving technology for improved safety. The company also strives to lower the cost of ownership for its customers through continuous efforts to reduce manufacturing costs and by offering financial and other services tailored to its products.<ref name=":4">https://www.sec.gov/Archives/edgar/data/1318605/000156459021004599/tsla-10k_20201231.htm</ref> | The company sells and leases high-performance fully electric vehicles and energy generation and storage systems, and offers services related to its products. Tesla is an innovator that emphasises performance, attractive styling and the safety of its users in the design and manufacture of its products and is continuing to develop full self-driving technology for improved safety. The company also strives to lower the cost of ownership for its customers through continuous efforts to reduce manufacturing costs and by offering financial and other services tailored to its products.<ref name=":4">https://www.sec.gov/Archives/edgar/data/1318605/000156459021004599/tsla-10k_20201231.htm</ref> | ||
Assuming that Tesla increases its share of the automotive market to 10% (from 2%) and other assumptions, the expected return of an investment in the company over the next five years is negative 24%, which equates to an annual return of negative 4%. In other words, an £100,000 investment in the company is expected to return £76,000 in five years time. | Assuming that Tesla increases its share of the automotive market to 10% (from 2%) and other assumptions, the expected return of an investment in the company over the next five years is negative 24%, which equates to an annual return of negative 4%. In other words, an £100,000 investment in the company is expected to return £76,000 in five years time. | ||
The degree of risk associated with an investment in Tesla is 'high', with the shares having a beta that is 112% above the market (2.12 vs. 1) | The degree of risk associated with an investment in Tesla is 'high', with the shares having a beta that is 112% above the market (2.12 vs. 1). | ||
==Operations== | ==Operations== | ||
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The idea of the company came about when the now founding team of the company realised that the current way that humankind is meeting its energy needs is unsustainable and bad for the planet.<ref name=":9">https://www.tesla.com/en_GB/blog/secret-tesla-motors-master-plan-just-between-you-and-me</ref> | The idea of the company came about when the now founding team of the company realised that the current way that humankind is meeting its energy needs is unsustainable and bad for the planet.<ref name=":9">https://www.tesla.com/en_GB/blog/secret-tesla-motors-master-plan-just-between-you-and-me</ref> | ||
Currently, an estimated 85% of the world's energy needs are met by burning fossil fuels<ref>https://wedocs.unep.org/bitstream/handle/20.500.11822/30797/EGR2019.pdf?sequence=1&isAllowed=y</ref>, and energy production and consumption are responsible for 76% of annual human-caused greenhouse gas emissions.<ref | Currently, an estimated 85% of the world's energy needs are met by burning fossil fuels<ref>https://wedocs.unep.org/bitstream/handle/20.500.11822/30797/EGR2019.pdf?sequence=1&isAllowed=y</ref>, and energy production and consumption are responsible for 76% of annual human-caused greenhouse gas emissions.<ref>https://www.climatewatchdata.org/ghg-emissions?breakBy=sector&chartType=percentage&end_year=2018§ors=total-including-lucf&start_year=1990</ref><ref>https://www.wri.org/insights/4-charts-explain-greenhouse-gas-emissions-countries-and-sectors</ref> | ||
Researching into a better way to meet the energy needs, the team concluded that the best way to do so is to move to a solar electric economy, from a mine-and-burn hydrocarbon economy.<ref name=":9" /> | Researching into a better way to meet the energy needs, the team concluded that the best way to do so is to move to a solar electric economy, from a mine-and-burn hydrocarbon economy.<ref name=":9" /> | ||
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====== Automotive sales ====== | ====== Automotive sales ====== | ||
As of | As of 11th August 2023, the company offers four main car models: Model S, Model 3, Model X and Model Y. | ||
'''Model S''' | '''Model S''' | ||
Model S is the fastest accelerating and longest ranging car that Tesla provides, with a zero-to-60 miles per hour acceleration of 3.1 seconds and a maximum distance range on a single battery charge of 405 miles, respectively.<ref>https://www.tesla.com/</ref> The price of the car in the US is $ | Model S is the fastest accelerating and longest ranging car that Tesla provides, with a zero-to-60 miles per hour acceleration of 3.1 seconds and a maximum distance range on a single battery charge of 405 miles, respectively.<ref>https://www.tesla.com/</ref> The price of the car in the US is $88,490 - $108,490.<ref name=":8" /> | ||
[[File:Model S.jpg]] | [[File:Model S.jpg]] | ||
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'''Model 3''' | '''Model 3''' | ||
Model 3 is the lowest priced car that Tesla provides, selling in the US at $ | Model 3 is the lowest priced car that Tesla provides, selling in the US at $40,240 - $53,240. | ||
'''Model X''' | '''Model X''' | ||
Model X is the largest cargo capacity car that Tesla provides, with a cargo capacity of 88 cubic feet. The price of the car in the US is $ | Model X is the largest cargo capacity car that Tesla provides, with a cargo capacity of 88 cubic feet. The price of the car in the US is $98,490- $108,490. | ||
[[File:MX-Hero-Desktop.jpg]] | [[File:MX-Hero-Desktop.jpg]] | ||
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'''Model Y''' | '''Model Y''' | ||
Model Y is the lowest price per cargo capacity and lowest price per seat car that Tesla provides, at $829 per cubic feet and $8,999 per seat, respectively. The price of the car in the US is $ | Model Y is the lowest price per cargo capacity and lowest price per seat car that Tesla provides, at $829 per cubic feet and $8,999 per seat, respectively. The price of the car in the US is $50,490 - $54,490. | ||
[[File:Model y red.jpg]] | [[File:Model y red.jpg]] | ||
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! colspan="2" |Model X | ! colspan="2" |Model X | ||
! colspan="3" |Model 3 | ! colspan="3" |Model 3 | ||
! colspan=" | ! colspan="3" |Model Y | ||
|- | |- | ||
!Type | !Type | ||
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!Long Range<ref name=":14" /> | !Long Range<ref name=":14" /> | ||
!Performance<ref name=":14" /> | !Performance<ref name=":14" /> | ||
!Standard | |||
!Long Range<ref name=":15">https://www.tesla.com/modely</ref> | !Long Range<ref name=":15">https://www.tesla.com/modely</ref> | ||
!Performance<ref name=":15" /> | !Performance<ref name=":15" /> | ||
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|style="background: orange; color: white;" |Yes | |style="background: orange; color: white;" |Yes | ||
|style="background: orange; color: white;" |Yes | |style="background: orange; color: white;" |Yes | ||
|Yes | |||
| style="background: orange; color: white;" |Yes | | style="background: orange; color: white;" |Yes | ||
|style="background: orange; color: white;" |Yes | |style="background: orange; color: white;" |Yes | ||
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|style="background: orange; color: white;" |4.2 seconds | |style="background: orange; color: white;" |4.2 seconds | ||
|style="background: orange; color: white;" |3.1 seconds | |style="background: orange; color: white;" |3.1 seconds | ||
|5.0 seconds | |||
| style="background: orange; color: white;" |4.8 seconds | | style="background: orange; color: white;" |4.8 seconds | ||
|style="background: orange; color: white;" |3.5 seconds | |style="background: orange; color: white;" |3.5 seconds | ||
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|style="background: orange; color: white;" |333 miles | |style="background: orange; color: white;" |333 miles | ||
| style="background: red; color: white;" |272 miles | | style="background: red; color: white;" |272 miles | ||
|style="background: orange; color: white;" | | |style="background: orange; color: white;" |333 miles | ||
|style="background: orange; color: white;" |315 miles | |style="background: orange; color: white;" |315 miles | ||
|279 miles | |||
| style="background: orange; color: white;" |330 miles | | style="background: orange; color: white;" |330 miles | ||
|style="background: orange; color: white;" |303 miles | |style="background: orange; color: white;" |303 miles | ||
|- | |- | ||
|What's the top speed of the vehicle? | |What's the top speed of the vehicle? | ||
| style="background: orange; color: white;" | | | style="background: orange; color: white;" |149 miles per hour | ||
|style="background: green; color: white;" |200 miles per hour | |style="background: green; color: white;" |200 miles per hour | ||
| style="background: orange; color: white;" | | | style="background: orange; color: white;" |149 miles per hour | ||
|style="background: orange; color: white;" | | |style="background: orange; color: white;" |149 miles per hour | ||
| style="background: orange; color: white;" |140 miles per hour | | style="background: orange; color: white;" |140 miles per hour | ||
|style="background: orange; color: white;" |145 miles per hour | |style="background: orange; color: white;" |145 miles per hour | ||
|style="background: orange; color: white;" |162 miles per hour | |style="background: orange; color: white;" |162 miles per hour | ||
|135 miles per hour | |||
| style="background: red; color: white;" |135 miles per hour | | style="background: red; color: white;" |135 miles per hour | ||
|style="background: orange; color: white;" |155 miles per hour | |style="background: orange; color: white;" |155 miles per hour | ||
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|style="background: orange; color: white;" |Sedan (i.e. car) | |style="background: orange; color: white;" |Sedan (i.e. car) | ||
|style="background: orange; color: white;" |Sedan (i.e. car) | |style="background: orange; color: white;" |Sedan (i.e. car) | ||
|SUV (i.e. car) | |||
| style="background: orange; color: white;" |SUV (i.e. car) | | style="background: orange; color: white;" |SUV (i.e. car) | ||
|style="background: orange; color: white;" |SUV (i.e. car) | |style="background: orange; color: white;" |SUV (i.e. car) | ||
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|style="background: orange; color: white;" |5 out of 5 stars | |style="background: orange; color: white;" |5 out of 5 stars | ||
|style="background: orange; color: white;" |5 out of 5 stars | |style="background: orange; color: white;" |5 out of 5 stars | ||
|5 out of 5 stars | |||
| style="background: orange; color: white;" |5 out of 5 stars | | style="background: orange; color: white;" |5 out of 5 stars | ||
|style="background: orange; color: white;" |5 out of 5 stars | |style="background: orange; color: white;" |5 out of 5 stars | ||
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|style="background: red; color: white;" |5 seats | |style="background: red; color: white;" |5 seats | ||
|style="background: red; color: white;" |5 seats | |style="background: red; color: white;" |5 seats | ||
|5 seats | |||
| style="background: orange; color: white;" |7 seats | | style="background: orange; color: white;" |7 seats | ||
|style="background: red; color: white;" |5 seats | |style="background: red; color: white;" |5 seats | ||
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| style="background: red; color: white;" |28 cubic feet | | style="background: red; color: white;" |28 cubic feet | ||
|style="background: red; color: white;" |28 cubic feet | |style="background: red; color: white;" |28 cubic feet | ||
| style="background: orange; color: white;" | | | style="background: orange; color: white;" |92 cubic feet | ||
|style="background: orange; color: white;" | | |style="background: orange; color: white;" |92 cubic feet | ||
| style="background: red; color: white;" |23 cubic feet | | style="background: red; color: white;" |23 cubic feet | ||
|style="background: red; color: white;" |23 cubic feet | |style="background: red; color: white;" |23 cubic feet | ||
|style="background: red; color: white;" |23 cubic feet | |style="background: red; color: white;" |23 cubic feet | ||
|76 cubic feet | |||
| style="background: red; color: white;" |76 cubic feet | | style="background: red; color: white;" |76 cubic feet | ||
|style="background: red; color: white;" |76 cubic feet | |style="background: red; color: white;" |76 cubic feet | ||
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|style="background: orange; color: white;" |All-wheel drive | |style="background: orange; color: white;" |All-wheel drive | ||
|style="background: orange; color: white;" |All-wheel drive | |style="background: orange; color: white;" |All-wheel drive | ||
|All-wheel drive | |||
| style="background: orange; color: white;" |All-wheel drive | | style="background: orange; color: white;" |All-wheel drive | ||
|style="background: orange; color: white;" |All-wheel drive | |style="background: orange; color: white;" |All-wheel drive | ||
|- | |- | ||
|What's the price of the vehicle? | |What's the price of the vehicle? | ||
| style="background: orange; color: white;" |$ | | style="background: orange; color: white;" |$88,490 | ||
|style="background: orange; color: white;" |$ | |style="background: orange; color: white;" |$108,490 | ||
| style="background: orange; color: white;" |$ | | style="background: orange; color: white;" |$98,490 | ||
|style="background: red; color: white;" |$ | |style="background: red; color: white;" |$108,490 | ||
| style="background: green; color: white;" |$ | | style="background: green; color: white;" |$40,240 | ||
|style="background: orange; color: white;" |$ | |style="background: orange; color: white;" |$47,240 | ||
|style="background: orange; color: white;" |$ | |style="background: orange; color: white;" |$53,240 | ||
| style="background: orange; color: white;" |$ | |$47,740 | ||
|style="background: orange; color: white;" |$ | | style="background: orange; color: white;" |$52,990 | ||
|style="background: orange; color: white;" |$54,490 | |||
|- | |- | ||
|What's the vehicle's price per cargo capacity? | |What's the vehicle's price per cargo capacity? | ||
| style="background: orange; color: white;" |$3, | | style="background: orange; color: white;" |$3,160 per cubic feet | ||
|style="background: red; color: white;" |$ | |style="background: red; color: white;" |$3,875 per cubic feet | ||
| style="background: orange; color: white;" |$1, | | style="background: orange; color: white;" |$1,071 per cubic feet | ||
|style="background: orange; color: white;" |$1, | |style="background: orange; color: white;" |$1,179 per cubic feet | ||
| style="background: orange; color: white;" |$ | | style="background: orange; color: white;" |$1,750 per cubic feet | ||
|style="background: orange; color: white;" |$2, | |style="background: orange; color: white;" |$2,054 per cubic feet | ||
|style="background: orange; color: white;" |$2, | |style="background: orange; color: white;" |$2,315 per cubic feet | ||
| style="background: green; color: white;" |$ | |$628 per cubic feet | ||
|style="background: orange; color: white;" |$ | | style="background: green; color: white;" |$697 per cubic feet | ||
|style="background: orange; color: white;" |$717 per cubic feet | |||
|- | |- | ||
|What's the vehicle's price per seat? | |What's the vehicle's price per seat? | ||
| style="background: orange; color: white;" |$ | | style="background: orange; color: white;" |$17,698 per seat | ||
|style="background: red; color: white;" |$ | |style="background: red; color: white;" |$21,698 per seat | ||
| style="background: orange; color: white;" |$ | | style="background: orange; color: white;" |$14,070 per seat | ||
|style="background: orange; color: white;" |$ | |style="background: orange; color: white;" |$18,082 per seat | ||
| style="background: orange; color: white;" |$ | | style="background: orange; color: white;" |$8,048 per seat | ||
|style="background: orange; color: white;" |$ | |style="background: orange; color: white;" |$9,448 per seat | ||
|style="background: orange; color: white;" |$ | |style="background: orange; color: white;" |$10,648 per seat | ||
| style="background: green; color: white;" |$ | |$9,548 per seat | ||
|style="background: orange; color: white;" |$ | | style="background: green; color: white;" |$7,570 per seat | ||
|style="background: orange; color: white;" |$10,898 per seat | |||
|} | |} | ||
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|Which Tesla car has the largest cargo capacity? | |Which Tesla car has the largest cargo capacity? | ||
|Model X and Model X Plaid | |Model X and Model X Plaid | ||
|The cargo capacity of the car is | |The cargo capacity of the car is 92 cubic feet. | ||
|- | |- | ||
|Which Tesla car has the most seats? | |Which Tesla car has the most seats? | ||
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|Which Tesla car is the lowest priced? | |Which Tesla car is the lowest priced? | ||
|Model 3 Rear-Wheel Drive | |Model 3 Rear-Wheel Drive | ||
|The price of the car is $ | |The price of the car is $40,240. | ||
|- | |- | ||
|Which Tesla car has the lowest price per cargo capacity? | |Which Tesla car has the lowest price per cargo capacity? | ||
|Model Y | |Model Y Standard | ||
|The price per cargo capacity of the car is $ | |The price per cargo capacity of the car is $628 per cubic feet. | ||
|- | |- | ||
|Which Tesla car has the lowest price per seat? | |Which Tesla car has the lowest price per seat? | ||
|Model Y Long Range | |Model Y Long Range | ||
|The price per seat of the car is $ | |The price per seat of the car is $7,570 per seat. | ||
|} | |} | ||
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'''Cybertruck''' | '''Cybertruck''' | ||
Cybertruck is a truck, a motor vehicle designed to transport cargo, carry specialised payloads, or perform other utilitarian work. What will be unique about the offering is that it will be the safest vehicle that Tesla provides. The price of the offering is expected to be $39,900.<ref>https://www.autoexpress.co.uk/tesla/cybertruck/96447/tesla-cybertruck-delayed-until-least-2023#:~:text=Tesla%20Cybertruck%3A%20performance%20and%20range&text=Entry%2Dlevel%2C%20Single%20Motor%2C,a%20top%20speed%20of%20110mph.</ref> | Cybertruck is a truck, a motor vehicle designed to transport cargo, carry specialised payloads, or perform other utilitarian work. What will be unique about the offering is that it will be the safest vehicle that Tesla provides- combining both ultra-hard 30x cold-rolled stainless steel and Tesla Armor Glass. The price of the offering is expected to be $39,900.<ref>https://www.autoexpress.co.uk/tesla/cybertruck/96447/tesla-cybertruck-delayed-until-least-2023#:~:text=Tesla%20Cybertruck%3A%20performance%20and%20range&text=Entry%2Dlevel%2C%20Single%20Motor%2C,a%20top%20speed%20of%20110mph.</ref> | ||
[[File:Cybertruck-Hero-Desktop.jpg]] | [[File:Cybertruck-Hero-Desktop.jpg]] | ||
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'''Tesla Semi''' | '''Tesla Semi''' | ||
Tesla Semi is a semi-trailer truck, a motor vehicle that is designed to transport large cargo, via one or more of its attached trailers. What will be unique about the offering is that it will be the largest cargo capacity vehicle that Tesla provides. The price of the offering is around $150,000. | Tesla Semi is a semi-trailer truck, a motor vehicle that is designed to transport large cargo, via one or more of its attached trailers. What will be unique about the offering is that it will be the largest cargo capacity vehicle that Tesla provides. Moreover, operators will see approximate savings of $200,000 after three years because charging with electricity is cheaper than refueling with diesel. The price of the offering is around $150,000. | ||
[[File:Tesla-semi.jpg]] | [[File:Tesla-semi.jpg]] | ||
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'''Powerwall''' | '''Powerwall''' | ||
Powerwall is a energy storage system (i.e. a type of battery).<ref name=":4" /> What’s unique about the offering is that it's the lowest priced energy storage system that Tesla provides, selling at $10,500. The energy capacity of the product is 13.5 kilowatt hour (kWh). To help put the capacity into perspective, in 2020, the average household in the United States consumed 29 kWh per day.<ref>https://www.eia.gov/tools/faqs/faq.php?id=97&t=3#:~:text=How%20much%20electricity%20does%20an,about%20893%20kWh%20per%20month.</ref> So, if the average household is powered from Powerwalls only, then it will require around two Powerwalls to power the whole house, at an average annual cost of $2,247. | Powerwall is a energy storage system (i.e. a type of battery).<ref name=":4" /> What’s unique about the offering is that it's the lowest priced energy storage system that Tesla provides, selling at $10,500. The energy capacity of the product is 13.5 kilowatt hour (kWh). To help put the capacity into perspective, in 2020, the average household in the United States consumed 29 kWh per day.<ref>https://www.eia.gov/tools/faqs/faq.php?id=97&t=3#:~:text=How%20much%20electricity%20does%20an,about%20893%20kWh%20per%20month.</ref> So, if the average household is powered from Powerwalls only, then it will require around two Powerwalls to power the whole house, at an average annual cost of $2,247. Furthermore, Tesla offers its Powerwall buyers a $500 rebate for each Powerwall registered between June and October 2023. | ||
[[File:Powerwall2.jpg]] | [[File:Powerwall2.jpg]] | ||
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|} | |} | ||
=== Other current offerings === | |||
'''Service and Warranty''' | '''Service and Warranty''' | ||
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# Develop a self-driving capability that is 10x safer than manual, via massive fleet learning; and | # Develop a self-driving capability that is 10x safer than manual, via massive fleet learning; and | ||
# Enable your car to make money for you when you aren't using it. | # Enable your car to make money for you when you aren't using it. | ||
It's worth noting that 10 years earlier than the publication of the 2016 blog post, Elon detailed the company's first master plan<ref name=":9" />, and the company has managed to achieve all of the milestones, which were as follows: | It's worth noting that 10 years earlier than the publication of the 2016 blog post, Elon Musk detailed the company's first master plan<ref name=":9" />, and the company has managed to achieve all of the milestones, which were as follows: | ||
#Build a sports car (i.e. the Tesla Model S); | #Build a sports car (i.e. the Tesla Model S); | ||
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Here, the serviceable obtainable market (SOM) is defined as the US car market, and based on a number of assumptions, it is estimated that the size of the market as of today (30th May 2022), in terms of revenue, is $262 billion. | Here, the serviceable obtainable market (SOM) is defined as the US car market, and based on a number of assumptions, it is estimated that the size of the market as of today (30th May 2022), in terms of revenue, is $262 billion. | ||
=== Industry Demand Drivers === | |||
The mayor drivers of industry performance within the electric and hybrid US vehicle manufacturing market are:<ref>https://0-my-ibisworld-com.pugwash.lib.warwick.ac.uk/us/en/industry-specialized/od4516/industry-performance</ref> | |||
# '''Consumer confidence index:''' When consumers have less disposable income, they tend to delay purchases. The consumer confidence index plummeted during 2020 and is expected to further decrease during 2023 due to the expected recession. | |||
# '''Demand from new car dealers:''' The financial crisis has greatly affected dealers as companies have struggled to find enough funds to stock their showrooms. | |||
# '''World price of crude oil:''' Through 2023, the price of gasoline has grown, and consequently consumers have started to consider more purchasing more energy efficient vehicles like hybrid or electric cars. | |||
# '''Trade-weighted index:''' Levels of international trade are affected by the relative strength of the US dollar to other international currencies. The trade-weighted index measures the value of the US dollar against key trading partner currencies. | |||
# '''Tax credits for energy efficiency:''' Tax credits are expected to increase during 2023, which in turn incentivise demand for electric and hybrid cars. Customers have received up to $7,500 in tax credits. | |||
== Competition== | == Competition== | ||
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Tesla believes that its vehicles compete in the market both based on their traditional segment classification as well as based on their propulsion technology. For example, Model S and Model X compete primarily with premium sedans and premium SUVs, and Model 3 and Model Y compete with small to medium-sized sedans and compact SUVs, which are extremely competitive markets. Competing products typically include internal combustion vehicles from more established automobile manufacturers; however, many established and new automobile manufacturers have entered or have announced plans to enter the market for electric and other alternative fuel vehicles. Many major automobile manufacturers have electric vehicles available today in major markets including the US, China and Europe, and other current and prospective automobile manufacturers are also developing electric vehicles. In addition, several manufacturers offer hybrid vehicles, including plug-in versions. | Tesla believes that its vehicles compete in the market both based on their traditional segment classification as well as based on their propulsion technology. For example, Model S and Model X compete primarily with premium sedans and premium SUVs, and Model 3 and Model Y compete with small to medium-sized sedans and compact SUVs, which are extremely competitive markets. Competing products typically include internal combustion vehicles from more established automobile manufacturers; however, many established and new automobile manufacturers have entered or have announced plans to enter the market for electric and other alternative fuel vehicles. Many major automobile manufacturers have electric vehicles available today in major markets including the US, China and Europe, and other current and prospective automobile manufacturers are also developing electric vehicles. In addition, several manufacturers offer hybrid vehicles, including plug-in versions. | ||
Moreover, Tesla holds a 51.9% market share within the Hybrid and Electric US vehicle manufacturing market in 2023.<ref>https://0-my-ibisworld-com.pugwash.lib.warwick.ac.uk/us/en/industry-specialized/od4516/industry-performance</ref> Other competitors within this market include Toyota Motor, Ford Motor Co, Honda Motor Co, and General Motors Company. | |||
Tesla also believes that there is increasing competition for its vehicle offerings as a platform for delivering self-driving technologies, charging offerings and other features and services, and it expects to compete in this developing market through continued progress on its autopilot, full self-driving and neural network capabilities, Supercharger network and its infotainment offerings. | Tesla also believes that there is increasing competition for its vehicle offerings as a platform for delivering self-driving technologies, charging offerings and other features and services, and it expects to compete in this developing market through continued progress on its autopilot, full self-driving and neural network capabilities, Supercharger network and its infotainment offerings. | ||
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[[File:Elon Musk Royal Society (crop2).jpg|200px]] | [[File:Elon Musk Royal Society (crop2).jpg|200px]] | ||
Elon Musk is the Chief Executive Officer of Tesla and has served the position since October 2008 and as a member of the Board since April 2004. Elon has also served as Chief Executive Officer, Chief Technology Officer and Chairman of Space Exploration Technologies Corporation, an advanced rocket and spacecraft manufacturing and services company (“SpaceX ”), since May 2002, and served as Chairman of the Board of SolarCity Corporation, a solar installation company, from July 2006 until its acquisition by Tesla in November 2016 and served as Chief Executive Officer of Twitter, Inc., a social media company, since October 2022. Elon is also a founder of The Boring Company, an infrastructure company, and of Neuralink Corp., a company focused on developing brain-machine interfaces. Prior to SpaceX, Elon co-founded PayPal, an electronic payment system, which was acquired by eBay in October 2002, and Zip2 Corporation, a provider of Internet enterprise software and services, which was acquired by Compaq in March 1999. Elon has also served on the board of directors of Endeavor Group Holdings, Inc. since April 2021. Elon holds a B.A. in physics from the University of Pennsylvania and a B.S. in business from the Wharton School of the University of Pennsylvania. | |||
====Chief Financial Officer==== | ====Chief Financial Officer==== | ||
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Andrew Baglino has served as Tesla's Senior Vice President, Powertrain and Energy Engineering since October 2019. Previously, Drew served in various engineering positions continuously since joining Tesla in March 2006. Drew holds a B.S. in electrical engineering from Stanford University. | Andrew Baglino has served as Tesla's Senior Vice President, Powertrain and Energy Engineering since October 2019. Previously, Drew served in various engineering positions continuously since joining Tesla in March 2006. Drew holds a B.S. in electrical engineering from Stanford University. | ||
'''Senior Vice President''' | |||
Tom Zhu has served as Senior Vice President, Automotive since April 2023. Mr. Zhu joined Tesla in April 2014, and served in various operational roles before being appointed as Vice President, Greater China, where he led the construction and operations of Gigafactory Shanghai. Mr. Zhu holds a bachelor’s degree of commerce in information technology from the Auckland University of Technology and an M.B.A. from Duke University. | |||
===Board of Directors=== | ===Board of Directors=== | ||
Line 553: | Line 570: | ||
<noglossary>Ira received his JD/MBA from Stanford Graduate School of Business and Stanford Law School, where he was an Associate Editor of Stanford Law Review. He holds a B.A. from the University of California, Los Angeles, graduating Phi Beta Kappa and Summa Cum Laude.</noglossary> | <noglossary>Ira received his JD/MBA from Stanford Graduate School of Business and Stanford Law School, where he was an Associate Editor of Stanford Law Review. He holds a B.A. from the University of California, Los Angeles, graduating Phi Beta Kappa and Summa Cum Laude.</noglossary> | ||
''' | '''Joe Gebbia''' | ||
Mr. Gebbia has been a member of the Board since 2022. Mr. Gebbia co-founded Airbnb, Inc. in 2008 and has served on Airbnb’s board of directors since 2009. In 2022, Mr. Gebbia launched Samara, which produces fully customized, factory-made homes designed to create rental income, house family, support work from home, or bundled together, to form new types of housing communities. Mr. Gebbia received dual degrees in Graphic Design and Industrial Design from the Rhode Island School of Design, where he currently serves on the institution’s Board of Trustees. Mr. Gebbia is the Chairman of Airbnb.org, and also serves on the Olympic Refuge Foundation and leadership councils for UNHCR, Tent.org and Malala Fund. Mr. Gebbia is a sought-after speaker on design and entrepreneurship, and has been named in Business Week’s Top 20 Best Young Tech Entrepreneurs, Inc. Magazine’s Thirty-under-Thirty, Fortune’s Forty-under-Forty, and one of Fast Company’s Most Creative People. | |||
'''James Murdoch''' | '''James Murdoch''' | ||
Line 570: | Line 579: | ||
James Murdoch has been a member of the Board since July 2017. Since March 2019, Mr. Murdoch has been the Chief Executive Officer of Lupa Systems, a private investment company that he founded. Previously, Mr. Murdoch held a number of leadership roles at Twenty-First Century Fox, Inc. (“21CF”), a media company, over two decades, including its Chief Executive Officer from 2015 to March 2019, its Co-Chief Operating Officer from 2014 to 2015, its Deputy Chief Operating Officer and Chairman and Chief Executive Officer, International from 2011 to 2014 and its Chairman and Chief Executive, Europe and Asia from 2007 to 2011. Previously, he served as the Chief Executive Officer of Sky plc from 2003 to 2007, and as the Chairman and Chief Executive Officer of STAR Group Limited, a subsidiary of 21CF, from 2000 to 2003. Mr. Murdoch also formerly served on the boards of News Corporation from 2013 to July 2020, of 21CF from 2017 to 2019, of Sky plc from 2016 to 2018, of GlaxoSmithKline plc from 2009 to 2012 and of Sotheby’s from 2010 to 2012. | James Murdoch has been a member of the Board since July 2017. Since March 2019, Mr. Murdoch has been the Chief Executive Officer of Lupa Systems, a private investment company that he founded. Previously, Mr. Murdoch held a number of leadership roles at Twenty-First Century Fox, Inc. (“21CF”), a media company, over two decades, including its Chief Executive Officer from 2015 to March 2019, its Co-Chief Operating Officer from 2014 to 2015, its Deputy Chief Operating Officer and Chairman and Chief Executive Officer, International from 2011 to 2014 and its Chairman and Chief Executive, Europe and Asia from 2007 to 2011. Previously, he served as the Chief Executive Officer of Sky plc from 2003 to 2007, and as the Chairman and Chief Executive Officer of STAR Group Limited, a subsidiary of 21CF, from 2000 to 2003. Mr. Murdoch also formerly served on the boards of News Corporation from 2013 to July 2020, of 21CF from 2017 to 2019, of Sky plc from 2016 to 2018, of GlaxoSmithKline plc from 2009 to 2012 and of Sotheby’s from 2010 to 2012. | ||
'''JB Straubel''' | |||
Mr. Straubel is the Founder and Chief Executive Officer of Redwood Materials Inc., a Nevada-based company working to drive down the costs and environmental footprint of lithium-ion batteries by offering large-scale sources of domestic anode and cathode materials produced from recycled batteries. Mr. Straubel also co-founded and served as the Chief Technology Officer of Tesla from May 2005 to July 2019. Mr. Straubel previously served on the board of SolarCity Corporation and as a member of its Nominating and Corporate Governance Committee from August 2006 until its acquisition by Tesla in November 2016. Mr. Straubel has served on the board of directors of QuantumScape since November 2020. Mr. Straubel holds a B.S. in Energy Systems Engineering and a M.S. in Engineering, with an emphasis on energy conversion, from Stanford University. | |||
'''Kimbal Musk''' | '''Kimbal Musk''' | ||
Line 599: | Line 612: | ||
==== All periods ==== | ==== All periods ==== | ||
{| class="wikitable" | {| class="wikitable mw-collapsible" | ||
|+ | |+Historic financials<ref>Source: Stockhub Limited</ref><ref group="Note" name="Note04" /> | ||
|- | |- | ||
!Year | !Year | ||
Line 617: | Line 630: | ||
!'''17''' | !'''17''' | ||
!18 | !18 | ||
|- | |- | ||
|'''Year end date'''||'''31/12/2005'''||'''31/12/2006<ref name=":12">{{cite web|url=https://www.mercurynews.com/2014/07/14/2006-san-carlos-start-up-tesla-seeks-sexier-electric-car/|title=2006: San Carlos start-up Tesla seeks sexier electric car|date=July 14, 2014}}</ref><ref name="SEC">{{cite web | url=https://www.sec.gov/edgar/browse/?CIK=1318605 | title=Tesla, Inc. TSLA on Nasdaq | publisher=[[U.S. Securities and Exchange Commission]]}}</ref>'''||'''31/12/2007'''||'''31/12/2008'''||'''31/12/2009''' | |'''Year end date'''||'''31/12/2005'''||'''31/12/2006<ref name=":12">{{cite web|url=https://www.mercurynews.com/2014/07/14/2006-san-carlos-start-up-tesla-seeks-sexier-electric-car/|title=2006: San Carlos start-up Tesla seeks sexier electric car|date=July 14, 2014}}</ref><ref name="SEC">{{cite web | url=https://www.sec.gov/edgar/browse/?CIK=1318605 | title=Tesla, Inc. TSLA on Nasdaq | publisher=[[U.S. Securities and Exchange Commission]]}}</ref>'''||'''31/12/2007'''||'''31/12/2008'''||'''31/12/2009''' | ||
|'''31/12/2010<ref name="SEC" />''' | |'''31/12/2010<ref name="SEC" />''' | ||
|'''31/12/2011<ref name="SEC" />''' | |'''31/12/2011<ref name="SEC" />''' | ||
|'''31/12/2012<ref name="SEC" />''' | |'''31/12/2012<ref name="SEC" />''' | ||
|'''31/12/2013<ref name="SEC" />''' | |'''31/12/2013<ref name="SEC" />''' | ||
|'''31/12/2014<ref name="SEC" />''' | |'''31/12/2014<ref name="SEC" />''' | ||
|'''31/12/2015<ref name="SEC" />''' | |'''31/12/2015<ref name="SEC" />''' | ||
|'''31/12/2016<ref name="SEC" />''' | |'''31/12/2016<ref name="SEC" />''' | ||
|'''31/12/2017<ref name="SEC" />''' | |'''31/12/2017<ref name="SEC" />''' | ||
|'''31/12/2018<ref name="SEC" />''' | |'''31/12/2018<ref name="SEC" />''' | ||
|'''31/12/2019<ref name="SEC" />''' | |'''31/12/2019<ref name="SEC" />''' | ||
|'''31/12/2020<ref name="SEC" />''' | |'''31/12/2020<ref name="SEC" />''' | ||
|'''31/12/2021<ref name="SEC" />''' | |'''31/12/2021<ref name="SEC" />''' | ||
|'''31/12/2022''' | |'''31/12/2022''' | ||
| | |- | ||
| | | colspan="19" |<div style="text-align: center;">'''Income statement'''</div> | ||
|''' | |- | ||
|Revenues ($'million)|| 0||0||0.073||15||112 | |||
| | |117 | ||
|' | |204 | ||
| | |413 | ||
| | |2,013 | ||
| | |3,198 | ||
| | |4,046 | ||
| | |7,000 | ||
| | |11,759 | ||
| | |21,461 | ||
| | |24,578 | ||
| | |31,536 | ||
| | |53,823 | ||
| | |81,462 | ||
| | |- | ||
| | |Net profits ($'million)||style="color: red;" |-12||style="color: red;" |-30||style="color: red;" |-78||style="color: red;" |-83|| style="color: red;" |−56 | ||
| | |style="color: red;" |−154 | ||
| | |style="color: red;" |−254 | ||
| | |style="color: red;" |−396 | ||
| | |style="color: red;" |−74 | ||
| | |style="color: red;" |−294 | ||
| | |style="color: red;" |−889 | ||
| | |style="color: red;" |−675 | ||
| | |style="color: red;" |−1,962 | ||
| | |style="color: red;" |−976 | ||
| | |style="color: red;" |−862 | ||
| | |721 | ||
|' | |5,519 | ||
| | |12,556 | ||
| | |- | ||
| | | colspan="19" |<div style="text-align: center;">'''Balance sheet'''</div> | ||
| | |- | ||
| | |Total assets<br />($'million) | ||
| | |8 | ||
| | |44 | ||
| | |34 | ||
| | |52 | ||
| | |130 | ||
| | |386 | ||
|- | |713 | ||
| | |1,114 | ||
| | |2,417 | ||
| | |5,831 | ||
| | |8,068 | ||
| | |22,664 | ||
| | |28,655 | ||
| | |29,740 | ||
| | |34,309 | ||
| | |52,148 | ||
| | |62,131 | ||
| | |82,338 | ||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
|''' | |||
| | |||
|' | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
|- | |- | ||
| colspan=" | | colspan="19" |<div style="text-align: center;">'''Other'''</div> | ||
|- | |- | ||
| | |Employees | ||
| | |NA | ||
| | |70 | ||
| | |268 | ||
| | |252 | ||
| | |514 | ||
| | |899 | ||
| | |1,417 | ||
| | |2,914 | ||
| | |5,859 | ||
| | |10,161 | ||
| | |13,058 | ||
| | |17,782 | ||
| | |37,543 | ||
| | |48,817 | ||
| | |48,016 | ||
| | |70,757 | ||
| | |99,290 | ||
| | |127,855 | ||
| | |} | ||
=== Forward === | |||
====What are the financial forecasts?==== | |||
| | {| class="wikitable" | ||
| | |+Forward financials<ref>Source: Stockhub Limited</ref><ref group="Note" name="Note04" /> | ||
| | |- | ||
!Year | |||
!18 !!19!!20!!21!!22 | |||
!23 | |||
!24 | |||
!25 | |||
!26 | |||
!27 | |||
!28 | |||
!29 | |||
!30 | |||
!31 | |||
!32 | |||
!33 | |||
!34 | |||
!35 | |||
!36 | |||
!37 | |||
!38 | |||
!39 | |||
!40 | |||
!41 | |||
!42 | |||
!43 | |||
!44 | |||
!45 | |||
!46 | |||
!47 | |||
!48 | |||
!49 | |||
!50 | |||
!51 | |||
!52 | |||
!53 | |||
!54 | |||
!55 | |||
!56 | |||
!57 | |||
!58 | |||
!59 | |||
|- | |- | ||
| | |'''Year end date'''||'''31/12/2022'''||'''31/12/2023'''||'''31/12/2024'''||'''31/12/2025'''||'''31/12/2026''' | ||
| | |'''31/12/2027''' | ||
| | |'''31/12/2028''' | ||
| | |'''31/12/2029''' | ||
| | |'''31/12/2030''' | ||
| | |'''31/12/2031''' | ||
| | |'''31/12/2032''' | ||
| | |'''31/12/2033''' | ||
| | |'''31/12/2034''' | ||
| | |'''31/12/2035''' | ||
| | |'''31/12/2036''' | ||
| | |'''31/12/2037''' | ||
| | |'''31/12/2038''' | ||
| | |'''31/12/2039''' | ||
| | |'''31/12/2040''' | ||
| | |'''31/12/2041''' | ||
| | |'''31/12/2042''' | ||
| | |'''31/12/2043''' | ||
| | |'''31/12/2044''' | ||
|$ | |'''31/12/2045''' | ||
|$ | |'''31/12/2046''' | ||
|$ | |'''31/12/2047''' | ||
|$ | |'''31/12/2048''' | ||
|$ | |'''31/12/2049''' | ||
|$ | |'''31/12/2050''' | ||
|$ | |'''31/12/2051''' | ||
|$ | |'''31/12/2052''' | ||
|$ | |'''31/12/2053''' | ||
|$ | |'''31/12/2054''' | ||
|$ | |'''31/12/2055''' | ||
|$ | |'''31/12/2056''' | ||
|$ | |'''31/12/2057''' | ||
|$ | |'''31/12/2058''' | ||
|$ | |'''31/12/2059''' | ||
|$ | |'''31/12/2060''' | ||
|$ | |'''31/12/2061''' | ||
|$ | |'''31/12/2062''' | ||
|$ | |'''31/12/2063''' | ||
|$ | |- | ||
|$ | | colspan="43" |<div style="text-align: center;">'''Income statement'''</div> | ||
|$ | |- | ||
|$ | |Revenues ($'million)|| $78,935||$112,257||$154,816||$207,049||$268,527 | ||
|$ | |$337,721 | ||
|$ | |$411,894 | ||
|$ | |$487,157 | ||
|$ | |$558,739 | ||
|$ | |$621,448 | ||
|$ | |$670,282 | ||
|$ | |$701,078 | ||
|$2, | |$711,102 | ||
|$1, | |$699,445 | ||
|$ | |$667,163 | ||
|$ | |$617,116 | ||
|$ | |$553,551 | ||
|$ | |$481,510 | ||
|$ | |$406,171 | ||
|$21 | |$332,253 | ||
|$ | |$263,564 | ||
|$4 | |$202,749 | ||
|$2 | |$151,247 | ||
|$109,414 | |||
|- | |$76,757 | ||
| | |$52,217 | ||
| | |$34,448 | ||
| | |$22,038 | ||
| | |$13,673 | ||
| | |$8,226 | ||
|$4,799 | |||
|$2,715 | |||
|$1,490 | |||
|$793 | |||
| | |$409 | ||
|$205 | |||
|$99 | |||
|$47 | |||
|$21 | |||
|$9 | |||
|$4 | |||
|$2 | |||
|- | |||
|Gross profits ($'million)||$23,680||$33,677||$46,445||$62,115||$80,558 | |||
|$ | |$101,316 | ||
|$ | |$185,352 | ||
| | |$219,221 | ||
|$ | |$251,432 | ||
|$ | |$279,652 | ||
|$ | |$301,627 | ||
|$ | |$315,485 | ||
|$ | |$319,996 | ||
|$ | |$314,750 | ||
|$ | |$300,223 | ||
|$ | |$277,702 | ||
|$ | |$249,098 | ||
|$ | |$216,679 | ||
|$ | |$182,777 | ||
|$ | |$149,514 | ||
|$ | |$118,604 | ||
|$ | |$91,237 | ||
|$ | |$68,061 | ||
|$ | |$49,236 | ||
|$ | |$34,541 | ||
|$ | |$23,498 | ||
|$ | |$15,502 | ||
|$ | |$9,917 | ||
|$ | |$6,153 | ||
|$23, | |$3,702 | ||
|$15, | |$2,160 | ||
|$ | |$1,222 | ||
|$6, | |$670 | ||
|$ | |$357 | ||
|$2, | |$184 | ||
|$1, | |$92 | ||
|$ | |$45 | ||
|$ | |$21 | ||
|$ | |$10 | ||
|$ | |$4 | ||
|$ | |$2 | ||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$1 | |$1 | ||
|- | |- | ||
| | |Operating profits ($'million)||$11,840||$16,839||$23,222||$31,057||$40,279 | ||
|$50,658 | |||
|$123,568 | |||
|$146,147 | |||
|$167,622 | |||
|$186,434 | |||
|$201,085 | |||
|$210,323 | |||
|$213,331 | |||
| | |$209,834 | ||
|$200,149 | |||
|$185,135 | |||
|$166,065 | |||
| | |$144,453 | ||
|$ | |$121,851 | ||
|$ | |$99,676 | ||
| | |$79,069 | ||
|$ | |$60,825 | ||
|$ | |$45,374 | ||
|$ | |$32,824 | ||
|$ | |$23,027 | ||
|$ | |$15,665 | ||
|$ | |$10,335 | ||
|$ | |$6,612 | ||
|$ | |$4,102 | ||
|$ | |$2,468 | ||
|$ | |$1,440 | ||
|$ | |$815 | ||
|$ | |$447 | ||
|$ | |$238 | ||
|$ | |$123 | ||
|$ | |$61 | ||
|$ | |$30 | ||
|$ | |$14 | ||
|$ | |$6 | ||
|$ | |$3 | ||
|$ | |$1 | ||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$1, | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$ | |||
|$1 | |$1 | ||
|- | |- | ||
| | |Net profits ($'million)||$9,354||$13,302||$18,346||$24,535|| $31,820 | ||
|$40,020 | |||
|$97,619 | |||
| | |$115,456 | ||
| | |$132,421 | ||
| | |$147,283 | ||
| | |$158,857 | ||
| | |$166,156 | ||
| | |$168,531 | ||
| | |$165,769 | ||
| | |$158,118 | ||
| | |$146,256 | ||
| | |$131,192 | ||
| | |$114,118 | ||
| | |$96,263 | ||
| | |$78,744 | ||
| | |$62,465 | ||
| | |$48,052 | ||
| | |$35,846 | ||
| | |$25,931 | ||
| | |$18,191 | ||
| | |$12,376 | ||
| | |$8,164 | ||
| | |$5,223 | ||
| | |$3,240 | ||
| | |$1,949 | ||
| | |$1,137 | ||
| | |$643 | ||
| | |$353 | ||
| | |$188 | ||
| | |$97 | ||
| | |$48 | ||
| | |$24 | ||
| | |$11 | ||
| | |$5 | ||
| | |$2 | ||
| | |$1 | ||
| | |$0 | ||
| | |} | ||
| | |||
| | ==== What are the assumptions used to estimate the financial forecasts?==== | ||
| | |||
| | {| class="wikitable" | ||
| | |+Key inputs | ||
| | !Description | ||
| | !Value | ||
| | !Commentary | ||
| | |||
| | |||
| | |||
| | |||
| | |||
|- | |- | ||
| colspan=" | | colspan="3" | <div style="text-align: center;">'''Revenue'''</div> | ||
|- | |- | ||
| | |What's the estimated current size of the total addressable market? | ||
|$2,975,000,000 | |||
|Here, the total addressable market (TAM) is defined as the global automotive market, and based on a number of assumptions<ref group="Note" name="Note01" />, it is estimated that the size of the market as of today (30th May 2022), in terms of revenue, is $2.975 trillion. | |||
If the TAM is defined as the global energy market, then research suggests that the estimated size of the market is $6.777 trillion.<ref name=":16">https://www.ucl.ac.uk/bartlett/sustainable/sites/bartlett/files/an_exploration_of_energy_cost_ranges_limits_and_adjustment_process.pdf</ref> | |||
|- | |||
|What is the estimated company lifespan? | |||
|2, | |60 years | ||
|Tesla employs around 110,000, making the company a large organisation (more than 10,000 employees), and research shows that the average lifespan of a large corporation is around 50 years.<ref>Stadler, Enduring Success, 3–5.</ref> | |||
|- | |||
| | |What's the estimated annual growth rate of the total addressable market over the lifecycle of the company? | ||
|3% | |||
|Research shows that the growth rate of the global automotive market (i.e. the total addressable market) is similar to the growth rate of global gross domestic product<ref>http://www.robertpicard.net/files/econgrowthandadvertising.pdf</ref>, which has averaged (medium) around 3% per year in the last 20 years (2001 to 2022)<ref>https://www.macrotrends.net/countries/WLD/world/gdp-growth-rate</ref>. | |||
|- | |||
|What's the estimated company peak market share? | |||
|10% | |||
|The Stockhub users estimate that especially given the leadership of the company, the peak market share of Tesla is around 10%, and, therefore, suggests using the share amount here. As of 31st December 2021, Tesla's current share of the market is estimated at around 1.8%. | |||
|- | |||
| | |Which distribution function do you want to use to estimate company revenue? | ||
| | |Gaussian | ||
| | |Research suggests that the revenue pattern of companies is similar to the pattern produced by the Gaussian distribution function (i.e. the revenue distribution is bell shaped)<ref>http://escml.umd.edu/Papers/ObsCPMT.pdf</ref>, so the Stockhub users suggest using that function here. | ||
| | |- | ||
| | |What's the estimated standard deviation of company revenue? | ||
| | | 6 years | ||
| | |Another way of asking this question is this way: within how many years either side of the mean does 68% of revenue occur? Based on Tesla's current revenue amount (i.e. $54 billion) and Tesla's estimated lifespan (i.e. 60 years) and Tesla's estimated current stage of its lifecycle (i.e. growth stage), the Stockhub users suggest using 6 years (i.e. 68% of all sales happen within 6 years either side of the mean year), so that's what's used here. | ||
| | |- | ||
| | | colspan="3" |'''<div style="text-align: center;">Growth stages</div>''' | ||
| | |- | ||
| | |How many main stages of growth is the company expected to go through? | ||
| | | 4 stages | ||
| | |Research suggests that a company typically goes through four distinct stages of cash flow growth.<ref>Levie J, Lichtenstein BB (2010) A terminal assessment of stages theory: Introducing a dynamic approach to entrepreneurship. Entrepreneurship: Theory & Practice 34(2): 317–350. <nowiki>https://doi.org/10.1111/j.1540-6520.2010.00377.x</nowiki></ref> Research also shows that incorporating those stages into the discounted cash flow model improves the quality of the model and, ultimately, the quality of the value estimation.<ref>Stef Hinfelaar et al.:, 2019.</ref> | ||
| | |||
| | In addition, research shows that a key way to determine the stage which a company is in is by examining the cash flow patterns of the company.<ref>Dickinson, 2010.</ref> A summary of the economic links to cash flow patterns can be found in the appendix of this report. The Stockhub users estimate that with Tesla's operating cash flows positive (+), investing cash flows negative (-) and its financing cash flows positive (+), the company is in the second stage of growth (i.e. the 'growth' stage), and, therefore, it has a total of three main stages of growth. Note, to account for one-off events, the three-year average (median) amount was used to calculate the cash flows. | ||
| | |||
| | On 7th February 2022, Tesla said it currently expects: to continue to generate net positive operating cash flow as it has done in the last four fiscal years; its capital expenditures to be between $5.00 to $7.00 billion in 2022 and each of the next two fiscal years; and its ability to be self-funding to continue as long as macroeconomic factors support current trends in its sales. Accordingly, based on forward looking statements, it appears that the company is in stage two of the business lifecycle (i.e. the 'growth' stage), and, therefore, it has a total of three main stages of growth remaining. | ||
| | |- | ||
| | |What proportion of the company lifecycle is represented by growth stage 1? | ||
| | |30% | ||
| | |Research suggests 30%.<ref name=":6">http://escml.umd.edu/Papers/ObsCPMT.pdf</ref> | ||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
| | |||
|- | |- | ||
| | |What proportion of the company lifecycle is represented by growth stage 2? | ||
|10% | |||
|Research suggests 10%.<ref name=":6" /> | |||
|- | |- | ||
|What | | What proportion of the company lifecycle is represented by growth stage 3? | ||
| | |20% | ||
| | | Research suggests 20%.<ref name=":6" /> | ||
|- | |- | ||
|What | |What proportion of the company lifecycle is represented by growth stage 4? | ||
| | |40% | ||
| | |Research suggests 40%.<ref name=":6" /> | ||
|- | |- | ||
| | | colspan="3" |'''<div style="text-align: center;">Growth stage 2</div>''' | ||
| | |||
|- | |- | ||
| | |Cost of goods sold as a proportion of revenue (%) | ||
| | |79% | ||
| | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7">http://people.stern.nyu.edu/adamodar/pdfiles/papers/younggrowth.pdf</ref>, and the margin for its peers is 79%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
| | |Operating expenses as a proportion of revenue (%) | ||
| | |15% | ||
|Research suggests that | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers is 15%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
| | |Tax rate (%) | ||
| | |11% | ||
| | |Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the rate for its peers is 11%. | ||
|- | |- | ||
| | |Depreciation and amortisation as a proportion of revenue (%) | ||
|7% | |||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers is 7%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | |||
|- | |- | ||
| | |Fixed capital as a proportion of revenue (%) | ||
| | |10% | ||
|Research suggests that | |Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
| | |Working capital as a proportion of revenue (%) | ||
| | |15% | ||
|Research suggests | |Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the amount for its peers is 15%. | ||
|- | |- | ||
| | |Net borrowing ($000) | ||
| | |Zero | ||
| | |Stockhub suggests that for simplicity, the net borrowing figure is zero. | ||
|- | |- | ||
| | |Interest amount ($000) | ||
| | |Zero | ||
| | |Stockhub suggests that for simplicity, the interest amount figure is zero. | ||
|- | |- | ||
| colspan="3" |'''<div style="text-align: center;">Growth stage 3</div>''' | |||
| colspan="3" |'''<div style="text-align: center;">Growth stage | |||
|- | |- | ||
|Cost of goods sold as a proportion of revenue (%) | |Cost of goods sold as a proportion of revenue (%) | ||
| | |62% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers is 62%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Operating expenses as a proportion of revenue (%) | |Operating expenses as a proportion of revenue (%) | ||
| | |13% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers is 13%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Tax rate (%) | |Tax rate (%) | ||
| | |14% | ||
|Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the rate for its peers is 14%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Depreciation and amortisation as a proportion of revenue (%) | |Depreciation and amortisation as a proportion of revenue (%) | ||
| | |4% | ||
|Research suggests that it's best to use a similar | |Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the amount for its peers is 4%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Fixed capital as a proportion of revenue (%) | |Fixed capital as a proportion of revenue (%) | ||
| | |3% | ||
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the amount for its peers is 3%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Working capital as a proportion of revenue (%) | |Working capital as a proportion of revenue (%) | ||
| | |10% | ||
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Net borrowing ($000) | |Net borrowing ($000) | ||
|Zero | |Zero | ||
|Stockhub | |The Stockhub users suggest that for simplicity, the net borrowing figure is zero. | ||
|- | |- | ||
|Interest amount ($000) | |Interest amount ($000) | ||
|Zero | |Zero | ||
|Stockhub | |The Stockhub users suggest that for simplicity, the interest amount figure is zero. | ||
|- | |- | ||
| colspan="3" |'''<div style="text-align: center;">Growth stage | | colspan="3" |'''<div style="text-align: center;">Growth stage 4</div>''' | ||
|- | |- | ||
|Cost of goods sold as a proportion of revenue (%) | |Cost of goods sold as a proportion of revenue (%) | ||
| | |99% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers is 99%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Operating expenses as a proportion of revenue (%) | |Operating expenses as a proportion of revenue (%) | ||
| | |15% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers is 15%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Tax rate (%) | |Tax rate (%) | ||
| | |0% | ||
|Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the rate for its peers is 0%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Depreciation and amortisation as a proportion of revenue (%) | |Depreciation and amortisation as a proportion of revenue (%) | ||
| | |37% | ||
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 37%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Fixed capital as a proportion of revenue (%) | |Fixed capital as a proportion of revenue (%) | ||
| | | 1% | ||
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage | |Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 1%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
|Working capital as a proportion of revenue (%) | |Working capital as a proportion of revenue (%) | ||
|10% | | 10% | ||
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | |Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report. | ||
|- | |- | ||
Line 1,278: | Line 1,131: | ||
|Zero | |Zero | ||
|The Stockhub users suggest that for simplicity, the interest amount figure is zero. | |The Stockhub users suggest that for simplicity, the interest amount figure is zero. | ||
| | |} | ||
==Risks== | |||
As with any investment, investing in Tesla carries a level of risk. Overall, based on the key risks highlighted below, the degree of risk associated with an investment in Tesla is high. | |||
===Risks related to the ability to grow the business=== | |||
*Tesla may be impacted by macroeconomic conditions resulting from the global COVID-19 pandemic. | |||
*Tesla may experience delays in launching and ramping the production of its products and features, or Tesla may be unable to control its manufacturing costs. | |||
*Tesla may be unable to grow its global product sales, delivery and installation capabilities and its servicing and vehicle charging networks, or Tesla may be unable to accurately project and effectively manage its growth. | |||
*Tesla's future growth and success is dependent upon consumers’ demand for electric vehicles and specifically its vehicles in an automotive industry that is generally competitive, cyclical and volatile. | |||
*Tesla's suppliers may fail to deliver components according to schedules, prices, quality and volumes that are acceptable to us, or Tesla may be unable to manage these components effectively. | |||
*Tesla may be unable to meet its projected construction timelines, costs and production ramps at new factories, or Tesla may experience difficulties in generating and maintaining demand for products manufactured there. | |||
* Tesla will need to maintain and significantly grow its access to battery cells, including through the development and manufacture of its own cells, and control its related costs. | |||
*Tesla faces strong competition for its products and services from a growing list of established and new competitors. | |||
===Risks related to the company's operations=== | |||
*Tesla may experience issues with lithium-ion cells or other components manufactured at Gigafactory Nevada and Gigafactory Shanghai, which may harm the production and profitability of its vehicle and energy storage products. | |||
*Tesla faces risks associated with maintaining and expanding its international operations, including unfavourable and uncertain regulatory, political, economic, tax and labour conditions. | |||
*Tesla's business may suffer if its products or features contain defects, fail to perform as expected or take longer than expected to become fully functional. | |||
*Tesla may be required to defend or insure against product liability claims. | |||
*Tesla will need to maintain public credibility and confidence in its long-term business prospects in order to succeed. | |||
*Tesla may be unable to effectively grow, or manage the compliance, residual value, financing and credit risks related to, its various financing programs. | |||
*Tesla must manage ongoing obligations under its agreement with the Research Foundation for the State University of New York relating to its Gigafactory New York. | |||
*Tesla may experience issues with lithium-ion cells or other components manufactured at Gigafactory Nevada and Gigafactory Shanghai, which may harm the production and profitability of its vehicle and energy storage products. | |||
*Tesla faces risks associated with maintaining and expanding its international operations, including unfavourable and uncertain regulatory, political, economic, tax and labour conditions. | |||
*Tesla's business may suffer if its products or features contain defects, fail to perform as expected or take longer than expected to become fully functional. | |||
*Tesla may be required to defend or insure against product liability claims. | |||
*Tesla will need to maintain public credibility and confidence in its long-term business prospects in order to succeed. | |||
*Tesla may be unable to effectively grow, or manage the compliance, residual value, financing and credit risks related to, its various financing programs. | |||
*Tesla must manage ongoing obligations under its agreement with the Research Foundation for the State University of New York relating to its Gigafactory New York. | |||
*If Tesla is unable to attract, hire and retain key employees and qualified personnel, its ability to compete may be harmed. | *If Tesla is unable to attract, hire and retain key employees and qualified personnel, its ability to compete may be harmed. | ||
*Tesla is highly dependent on the services of Elon Musk, its Chief Executive Officer. | *Tesla is highly dependent on the services of Elon Musk, its Chief Executive Officer. | ||
Line 1,395: | Line 1,210: | ||
| Which valuation model do you want to use? | | Which valuation model do you want to use? | ||
|Discounted cash flow | |Discounted cash flow | ||
| There are two main approaches to | | There are two main approaches to estimating the value of an investment: | ||
# By calculating the present value of the investment's expected future cash flows (i.e. discounted cash flow valuation); and | # By calculating the present value of the investment's expected future cash flows (i.e. discounted cash flow valuation); and | ||
#By comparing the investment to other similar investments (i.e. relative valuation). | #By comparing the investment to other similar investments (i.e. relative valuation). | ||
Research suggests that in terms of estimating the expected return of an investment over a period of 12 | Research suggests that in terms of estimating the expected return of an investment over a period of 12 months or more, the approach that is more accurate is the discounted cash flow approach<ref name=":5">Demirakos et al., 2010; Gleason et al., 2013</ref>; nevertheless, for completeness purposes, separately, the valuation of the company is also estimated using the relative valuation approach (the valuation based on the relative approach can be found in the appendix of this report). | ||
Tesla has never paid cash dividends, and on 7th February 2022, it said that it currently does not anticipate paying any cash dividends in the foreseeable future. Accordingly, | Tesla has never paid cash dividends, and on 7th February 2022, it said that it currently does not anticipate paying any cash dividends in the foreseeable future. Accordingly, the free cash flow valuation method is recommended(rather than the dividend discount model). | ||
|- | |- | ||
|Which financial forecasts to use? | |Which financial forecasts to use? | ||
Line 1,469: | Line 1,284: | ||
|- | |- | ||
|The size of the total addressable market | |The size of the total addressable market | ||
| | |(18%) | ||
|(24%) | |(24%) | ||
| | |(36%) | ||
|- | |- | ||
|Tesla peak market share | |Tesla peak market share | ||
| | |(30%) | ||
| (24%) | | (24%) | ||
| | | (12%) | ||
|- | |- | ||
|The discount rate | |The discount rate | ||
| | |(32%) | ||
|(24%) | |(24%) | ||
| | | (18%) | ||
|} | |} | ||
Line 1,789: | Line 1,604: | ||
|+Balance sheet | |+Balance sheet | ||
!Year end date | !Year end date | ||
!31/12/2022 | |||
!31/12/2021 | !31/12/2021 | ||
!31/12/2020 | !31/12/2020 | ||
Line 1,795: | Line 1,611: | ||
|- | |- | ||
|'''Current Assets''' | |'''Current Assets''' | ||
| | |||
| | | | ||
| | | | ||
Line 1,801: | Line 1,618: | ||
|- | |- | ||
|Cash and Cash Equivalents ($million) | |Cash and Cash Equivalents ($million) | ||
|$16,253 | |||
|$17,576 | |$17,576 | ||
|$19,384 | |$19,384 | ||
Line 1,807: | Line 1,625: | ||
|- | |- | ||
|Short-Term Investments ($million) | |Short-Term Investments ($million) | ||
|$5,932 | |||
|$131 | |$131 | ||
| -- | | -- | ||
Line 1,813: | Line 1,632: | ||
|- | |- | ||
|Net Receivables ($million) | |Net Receivables ($million) | ||
|$2,952 | |||
|$1,913 | |$1,913 | ||
|$1,886 | |$1,886 | ||
Line 1,819: | Line 1,639: | ||
|- | |- | ||
|Inventory ($million) | |Inventory ($million) | ||
|$12,839 | |||
|$5,757 | |$5,757 | ||
|$4,101 | |$4,101 | ||
Line 1,825: | Line 1,646: | ||
|- | |- | ||
|Other Current Assets ($million) | |Other Current Assets ($million) | ||
|$2,941 | |||
|$1,723 | |$1,723 | ||
|$1,346 | |$1,346 | ||
Line 1,831: | Line 1,653: | ||
|- | |- | ||
|Total Current Assets ($million) | |Total Current Assets ($million) | ||
|$40,917 | |||
|$27,100 | |$27,100 | ||
|$26,717 | |$26,717 | ||
Line 1,837: | Line 1,660: | ||
|- | |- | ||
|'''Long-Term Assets''' | |'''Long-Term Assets''' | ||
| | |||
| | | | ||
| | | | ||
Line 1,843: | Line 1,667: | ||
|- | |- | ||
|Long-Term Investments ($million) | |Long-Term Investments ($million) | ||
| -- | |||
| -- | | -- | ||
| -- | | -- | ||
Line 1,849: | Line 1,674: | ||
|- | |- | ||
|Fixed Assets ($million) | |Fixed Assets ($million) | ||
|$31,146 | |||
|$25,411 | |$25,411 | ||
|$17,396 | |$17,396 | ||
Line 1,855: | Line 1,681: | ||
|- | |- | ||
|Goodwill ($million) | |Goodwill ($million) | ||
|$194 | |||
|$200 | |$200 | ||
|$207 | |$207 | ||
Line 1,861: | Line 1,688: | ||
|- | |- | ||
|Intangible Assets ($million) | |Intangible Assets ($million) | ||
|$215 | |||
|$257 | |$257 | ||
|$313 | |$313 | ||
Line 1,867: | Line 1,695: | ||
|- | |- | ||
|Other Assets ($million) | |Other Assets ($million) | ||
|$9,866 | |||
|$9,163 | |$9,163 | ||
|$7,515 | |$7,515 | ||
Line 1,873: | Line 1,702: | ||
|- | |- | ||
|Deferred Asset Charges ($million) | |Deferred Asset Charges ($million) | ||
| -- | |||
| -- | | -- | ||
| -- | | -- | ||
Line 1,879: | Line 1,709: | ||
|- | |- | ||
|Total Assets ($million) | |Total Assets ($million) | ||
|$82,338 | |||
|$62,131 | |$62,131 | ||
|$52,148 | |$52,148 | ||
Line 1,885: | Line 1,716: | ||
|- | |- | ||
|'''Current Liabilities''' | |'''Current Liabilities''' | ||
| | |||
| | | | ||
| | | | ||
Line 1,891: | Line 1,723: | ||
|- | |- | ||
|Accounts Payable ($million) | |Accounts Payable ($million) | ||
|$22,397 | |||
|$15,744 | |$15,744 | ||
|$9,906 | |$9,906 | ||
Line 1,897: | Line 1,730: | ||
|- | |- | ||
|Short-Term Debt / Current Portion of Long-Term Debt ($million) | |Short-Term Debt / Current Portion of Long-Term Debt ($million) | ||
|$1,502 | |||
|$1,589 | |$1,589 | ||
|$2,132 | |$2,132 | ||
Line 1,903: | Line 1,737: | ||
|- | |- | ||
|Other Current Liabilities ($million) | |Other Current Liabilities ($million) | ||
|$2,810 | |||
|$2,372 | |$2,372 | ||
|$2,210 | |$2,210 | ||
Line 1,909: | Line 1,744: | ||
|- | |- | ||
|Total Current Liabilities ($million) | |Total Current Liabilities ($million) | ||
|$26,709 | |||
|$19,705 | |$19,705 | ||
|$14,248 | |$14,248 | ||
Line 1,915: | Line 1,751: | ||
|- | |- | ||
|Long-Term Debt ($million) | |Long-Term Debt ($million) | ||
|$1,597 | |||
|$5,245 | |$5,245 | ||
|$9,556 | |$9,556 | ||
Line 1,921: | Line 1,758: | ||
|- | |- | ||
|Other Liabilities ($million) | |Other Liabilities ($million) | ||
|$5,330 | |||
|$3,546 | |$3,546 | ||
|$3,330 | |$3,330 | ||
Line 1,927: | Line 1,765: | ||
|- | |- | ||
|Deferred Liability Charges ($million) | |Deferred Liability Charges ($million) | ||
|$2,804 | |||
|$2,052 | |$2,052 | ||
|$1,284 | |$1,284 | ||
Line 1,933: | Line 1,772: | ||
|- | |- | ||
|Misc. Stocks ($million) | |Misc. Stocks ($million) | ||
|$785 | |||
|$826 | |$826 | ||
|$850 | |$850 | ||
Line 1,939: | Line 1,779: | ||
|- | |- | ||
|Minority Interest ($million) | |Minority Interest ($million) | ||
|$409 | |||
|$568 | |$568 | ||
|$655 | |$655 | ||
Line 1,945: | Line 1,786: | ||
|- | |- | ||
|Total Liabilities ($million) | |Total Liabilities ($million) | ||
|$37,634 | |||
|$31,374 | |$31,374 | ||
|$29,268 | |$29,268 | ||
Line 1,951: | Line 1,793: | ||
|- | |- | ||
|'''Stock Holders Equity''' | |'''Stock Holders Equity''' | ||
| | |||
| | | | ||
| | | | ||
Line 1,957: | Line 1,800: | ||
|- | |- | ||
|Common Stocks ($million) | |Common Stocks ($million) | ||
|$1 | |||
|$1 | |$1 | ||
|$1 | |$1 | ||
Line 1,963: | Line 1,807: | ||
|- | |- | ||
|Capital Surplus ($million) | |Capital Surplus ($million) | ||
|$12,887 | |||
|$331 | |$331 | ||
| style="color: red;" |-$5,399 | | style="color: red;" |-$5,399 | ||
Line 1,969: | Line 1,814: | ||
|- | |- | ||
|Retained Earnings | |Retained Earnings | ||
| --- | |||
| -- | | -- | ||
| -- | | -- | ||
Line 1,975: | Line 1,821: | ||
|- | |- | ||
|Treasury Stock ($million) | |Treasury Stock ($million) | ||
|$32,177 | |||
|$29,803 | |$29,803 | ||
|$27,260 | |$27,260 | ||
Line 1,981: | Line 1,828: | ||
|- | |- | ||
|Other Equity ($million) | |Other Equity ($million) | ||
| -$361 | |||
|$54 | |$54 | ||
|$363 | |$363 | ||
Line 1,987: | Line 1,835: | ||
|- | |- | ||
|Total Equity ($million) | |Total Equity ($million) | ||
|$44,704 | |||
|$30,189 | |$30,189 | ||
|$22,225 | |$22,225 | ||
Line 1,993: | Line 1,842: | ||
|- | |- | ||
|Total Liabilities & Equity ($million) | |Total Liabilities & Equity ($million) | ||
|$82,338 | |||
|$62,131 | |$62,131 | ||
|$52,148 | |$52,148 | ||
Line 2,002: | Line 1,852: | ||
|+Cash flow | |+Cash flow | ||
!Year end date | !Year end date | ||
!31/12/2022 | |||
!31/12/2021 | !31/12/2021 | ||
!31/12/2020 | !31/12/2020 | ||
Line 2,008: | Line 1,859: | ||
|- | |- | ||
|Net Income ($million) | |Net Income ($million) | ||
|$12,587 | |||
|$5,519 | |$5,519 | ||
|$721 | |$721 | ||
Line 2,014: | Line 1,866: | ||
|- | |- | ||
|'''Cash Flows-Operating Activities''' | |'''Cash Flows-Operating Activities''' | ||
| | |||
| | | | ||
| | | | ||
Line 2,020: | Line 1,873: | ||
|- | |- | ||
|Depreciation ($million) | |Depreciation ($million) | ||
|$3,747 | |||
|$2,911 | |$2,911 | ||
|$2,322 | |$2,322 | ||
Line 2,026: | Line 1,880: | ||
|- | |- | ||
|Net Income Adjustments ($million) | |Net Income Adjustments ($million) | ||
|? | |||
|$2,424 | |$2,424 | ||
| $2,575 | | $2,575 | ||
Line 2,032: | Line 1,887: | ||
|- | |- | ||
|'''Changes in Operating Activities''' | |'''Changes in Operating Activities''' | ||
| | |||
| | | | ||
| | | | ||
Line 2,038: | Line 1,894: | ||
|- | |- | ||
|Accounts Receivable ($million) | |Accounts Receivable ($million) | ||
| -$1,124 | |||
| style="color: red;" |-$130 | | style="color: red;" |-$130 | ||
| style="color: red;" |-$652 | | style="color: red;" |-$652 | ||
Line 2,044: | Line 1,901: | ||
|- | |- | ||
|Changes in Inventories ($million) | |Changes in Inventories ($million) | ||
| -$6,465 | |||
| style="color: red;" |-$1,709 | | style="color: red;" |-$1,709 | ||
| style="color: red;" |-$422 | | style="color: red;" |-$422 | ||
Line 2,050: | Line 1,908: | ||
|- | |- | ||
|Other Operating Activities ($million) | |Other Operating Activities ($million) | ||
|? | |||
| style="color: red;" |-$3,676 | | style="color: red;" |-$3,676 | ||
| style="color: red;" |-$1,667 | | style="color: red;" |-$1,667 | ||
Line 2,056: | Line 1,915: | ||
|- | |- | ||
|Liabilities ($million) | |Liabilities ($million) | ||
|? | |||
|$6,033 | |$6,033 | ||
|$2,925 | |$2,925 | ||
Line 2,062: | Line 1,922: | ||
|- | |- | ||
|Net Cash Flow-Operating ($million) | |Net Cash Flow-Operating ($million) | ||
|$14,724 | |||
| $11,497 | | $11,497 | ||
| $5,943 | | $5,943 | ||
Line 2,068: | Line 1,929: | ||
|- | |- | ||
|'''Cash Flows-Investing Activities''' | |'''Cash Flows-Investing Activities''' | ||
| | |||
| | | | ||
| | | | ||
Line 2,074: | Line 1,936: | ||
|- | |- | ||
|Capital Expenditures ($million) | |Capital Expenditures ($million) | ||
|$7,163 | |||
| style="color: red;" |-$6,514 | | style="color: red;" |-$6,514 | ||
| style="color: red;" |-$3,232 | | style="color: red;" |-$3,232 | ||
Line 2,080: | Line 1,943: | ||
|- | |- | ||
|Investments ($million) | |Investments ($million) | ||
| -$5,835 | |||
| style="color: red;" |-$132 | | style="color: red;" |-$132 | ||
| -- | | -- | ||
Line 2,086: | Line 1,950: | ||
|- | |- | ||
|Other Investing Activities ($million) | |Other Investing Activities ($million) | ||
|$1012 | |||
| style="color: red;" |-$1,222 | | style="color: red;" |-$1,222 | ||
|$100 | |$100 | ||
Line 2,092: | Line 1,957: | ||
|- | |- | ||
|Net Cash Flows-Investing ($million) | |Net Cash Flows-Investing ($million) | ||
| -$11,973 | |||
| style="color: red;" |-$7,868 | | style="color: red;" |-$7,868 | ||
| style="color: red;" |-$3,132 | | style="color: red;" |-$3,132 | ||
Line 2,098: | Line 1,964: | ||
|- | |- | ||
|'''Cash Flows-Financing Activities''' | |'''Cash Flows-Financing Activities''' | ||
| | |||
| | | | ||
| | | | ||
Line 2,104: | Line 1,971: | ||
|- | |- | ||
|Sale and Purchase of Stock ($million) | |Sale and Purchase of Stock ($million) | ||
| -- | |||
|$699 | |$699 | ||
|$12,675 | |$12,675 | ||
Line 2,110: | Line 1,978: | ||
|- | |- | ||
|Net Borrowings ($million) | |Net Borrowings ($million) | ||
| -- | |||
| style="color: red;" |-$5,732 | | style="color: red;" |-$5,732 | ||
| style="color: red;" |-$2,488 | | style="color: red;" |-$2,488 | ||
Line 2,116: | Line 1,985: | ||
|- | |- | ||
|Other Financing Activities ($million) | |Other Financing Activities ($million) | ||
| | |||
| -- | | -- | ||
| -- | | -- | ||
Line 2,122: | Line 1,992: | ||
|- | |- | ||
|Net Cash Flows-Financing ($million) | |Net Cash Flows-Financing ($million) | ||
| -$3,527 | |||
| style="color: red;" |-$5,203 | | style="color: red;" |-$5,203 | ||
|$9,973 | |$9,973 | ||
Line 2,128: | Line 1,999: | ||
|- | |- | ||
|Effect of Exchange Rate ($million) | |Effect of Exchange Rate ($million) | ||
| -$444 | |||
| style="color: red;" |-$183 | | style="color: red;" |-$183 | ||
|$334 | |$334 | ||
Line 2,134: | Line 2,006: | ||
|- | |- | ||
|Net Cash Flow ($million) | |Net Cash Flow ($million) | ||
| -$1,220 | |||
| style="color: red;" |-$1,757 | | style="color: red;" |-$1,757 | ||
|$13,118 | |$13,118 | ||
Line 2,404: | Line 2,277: | ||
In the typical case in which the equity risk premium is based on a national equity market index and estimated beta is based on sensitivity to that index, the assumption is being made implicitly that equity prices are largely determined by local investors. When equities markets are segmented in that sense (i.e., local market prices are largely determined by local investors rather than by investors worldwide), two issues with the same risk characteristics can have different required returns if they trade in different markets. | In the typical case in which the equity risk premium is based on a national equity market index and estimated beta is based on sensitivity to that index, the assumption is being made implicitly that equity prices are largely determined by local investors. When equities markets are segmented in that sense (i.e., local market prices are largely determined by local investors rather than by investors worldwide), two issues with the same risk characteristics can have different required returns if they trade in different markets. | ||
The opposite assumption is that all investors worldwide participate equally in | The opposite assumption is that all investors worldwide participate equally in setting prices (perfectly integrated markets). That assumption results in the international CAPM (or world CAPM) in which the risk premium is relative to a world market portfolio. In practice, the international CAPM is not commonly relied on for required return on equity estimation. | ||
For estimating the required return on the equity using the Capital Asset Pricing Model, in terms of time period, and frequency of observations, the most common choice is five years of monthly data, yielding 60 observations. One study of U.S. stocks found support for five years of monthly data over alternatives. An argument can be made that the 2 years, weekly data can be especially appropriate in fast growing markets. | For estimating the required return on the equity using the Capital Asset Pricing Model, in terms of time period, and frequency of observations, the most common choice is five years of monthly data, yielding 60 observations. One study of U.S. stocks found support for five years of monthly data over alternatives. An argument can be made that the 2 years, weekly data can be especially appropriate in fast growing markets. | ||
Line 2,410: | Line 2,283: | ||
The beta value in a future period has been found to be on average closer to the mean value of 1.0, the beta of an average-systematic-risk security, than to the value of the raw beta. Because valuation is forward looking, it is logical to adjust the raw beta so it more accurately predicts a future beta. | The beta value in a future period has been found to be on average closer to the mean value of 1.0, the beta of an average-systematic-risk security, than to the value of the raw beta. Because valuation is forward looking, it is logical to adjust the raw beta so it more accurately predicts a future beta. | ||
The figure here is taken from Yahoo Finance | The figure here is taken from Yahoo Finance on 16th September 2022<ref>https://uk.finance.yahoo.com/quote/AAPL?p=AAPL&.tsrc=fin-srch</ref>. | ||
|- | |- | ||
|Equity risk premium (%) | |Equity risk premium (%) | ||
Line 2,427: | Line 2,300: | ||
'''Forward-looking estimates''' | '''Forward-looking estimates''' | ||
Because the equity risk premium is based only on expectations for economic and financial variables from the present going forward, it is logical to estimate the premium directly based on current information and expectations concerning such variables. Such estimates are often called forward-looking or ex ante estimates. In principle, such estimates may agree with, be higher, or be lower than historical equity risk premium estimates. Ex ante estimates are likely to be less subject to an issue such as non-stationarity or data biases than historical estimates. However, such estimates are often subject to other potential errors related to financial and economic models and potential behavioural biases in forecasting. | Because the equity risk premium is based only on expectations for economic and financial variables from the present going forward, it is logical to estimate the premium directly based on current information and expectations concerning such variables. Such estimates are often called forward-looking or ex ante estimates. In principle, such estimates may agree with, be higher, or be lower than historical equity risk premium estimates. Ex ante estimates are likely to be less subject to an issue such as non-stationarity or data biases than historical estimates. However, such estimates are often subject to other potential errors related to financial and economic models and potential behavioural biases in forecasting. Here, the equity risk premium is in relation to the global region, and is calculated as at 1st January 2022 <ref>https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html</ref>. | ||
Here, the equity risk premium is in relation to the global region, and is calculated as at 1st January 2022 | |||
|- | |- | ||
|Cost of equity (%) | |Cost of equity (%) | ||
Line 2,673: | Line 2,544: | ||
|Agriculture, Forestry and Land Use | |Agriculture, Forestry and Land Use | ||
|} | |} | ||
== Notes== | == Notes== | ||
Line 3,032: | Line 2,594: | ||
The kilowatt-hour (kWh) is a unit of energy equal to one kilowatt of power sustained for one hour and is commonly used as a measure of electrical energy. One kilowatt-hour is equal to 3600 kilojoules (3.6 megajoules). | The kilowatt-hour (kWh) is a unit of energy equal to one kilowatt of power sustained for one hour and is commonly used as a measure of electrical energy. One kilowatt-hour is equal to 3600 kilojoules (3.6 megajoules). | ||
{| class="wikitable" | {| class="wikitable" | ||
|+'''Powerwall annual cost calculation''' | |+'''Powerwall annual cost calculation''' |