2014 Tesla Motors Annual Report
“Energy cannot be created or destroyed, it can only be changed from one form to another.� Albert Einstein
Under The Hood
10 Letter from the CEO 18 Financial highlights 22 Changing the world 30 Get to know the team 32 Subsidary Info
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We may be young but we can kick your ass. 9 01
To my fellow Tesla activists, We can confidently say that Tesla Motors continues to operate from a position of balance and strength. We are the second-largest car and battery business in the world, and the largest car and battery business in the North America region area. Tesla Motors is increasingly global. More than 45 percent of our revenue comes from outside the United States, with approximately 30 percent coming from emerging and developing markets, where we have tremendous growth opportunities. Globally, Tesla Motors operates more than 100,000 routes, serves approximately 10 million outlets almost every week and generates more than $300 million in retail sales almost every day. We are performing today to deliver top-tier financial performance, while
investing to ensure that our performance levels can be sustained in the long term. For example, in 2010 we stepped up our investments in brand building, R&D, emerging markets infrastructure and our people. In 2013, in recognition of the importance of sustainability to Tesla’s Innovation strategy, we transitioned our Sustainable Business & Innovation organization into Tesla’s core Innovation function, signaling the enterprisewide role sustainable innovation will play in Tesla’s future. Our future is a bright one because we are the leading electric car company. The cars we produce are awesome. We hope Tesla’s experience as one of the first brands to respond to the challenges of responsibility positively.
“We have reached another epic point in human history in which the ability to change will determine our future existense.”
Elon Musk 9 10
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Don’t let the past define who you are in the present.
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Tesla wins Motor Trend Car of the Year award.
Model S sets Guinness World Record.
Model S wins the 2013 Motor Trend Car of the Year award and the best possible US National Highway Traffic Safety Administration rating.
Model S sets fastest charge time for any electric vehicle, with a 40 minute record.
Gigafactory to open in Reno, NV. 3. Gigafactory to open in Reno, NV.
Plans to build gigafactory in Reno will cut battery prices down 30 percent, lowering the price of Tesla vehicles.
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Tesla expands Supercharger stations, stores, and vehicles into the city of Hong Kong, China. This is a huge opportunity for growth in the company.
100 Supercharger stations Tesla announces 100 Supercharger stations open in the U.S. We predict another 100 4. Superchargers to open next year as well.
2014 Company Highlights
Model S is released in Hong Kong.
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2014 Financial Highlights
Car Sales 2012-2014
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2012
543,000
2013
704,000
2014
1,221,200
NASDAQ Shareholders 2012
2013
2014
50,135
125,400
157,320
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The road most traveled by has a dead end. 21 22
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My name is Li.
I
live in one of the most polluted cities in China, Baoding. Every day I must wear a mask and eyewear to protect myself from the smog that covers the city. I choose to drive a Tesla because I know that if everyone else drove one the air would be clean again. Now that there are more supercharger stations in China I think that we can start to reverse our effects on air quality. It is very important that we drive electric cars in China. Every day I must wear a mask and eyewear to protect myself from the smog that covers the city. I choose to drive a Tesla because I know that if everyone else drove one the air would be clean again. This is a filler sentence isn’t it awesome.I live in one of the most polluted cities in China, Baoding. Every day I must wear a mask and eyewear to protect myself from the smog that covers the city. The 273-to-156 vote was over a narrow military measure with no money attached, but it took on outsize importance and was infused with drama. Speaker John A. Boehner of Ohio and Representative Nancy Pelosi of California, the minority leader, actively and strongly backed the legislation, and both sought to portray it as
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a modest measure. The Senate hopes to pass it as soon as Thursday. “The American forces that have been deployed to Iraq do not and will not have a combat mission,� Opponents in both parties framed the vote as a step toward a wider war in a region. The fields here are among a handful of places in the world where researchers are trying to mimic the growing conditions expected to arise decades in the future as the air fills with heat-trapping gases and other pollutants from human activity. A network of pipes sprays extra carbon dioxide and a corrosive pollutant, ozone, into the air. Lamps and other equipment mimic future droughts and heat waves. At the same time, the panel pointed out the enormous potential for agriculture to adapt to climatic change, with shifts in farming practices and with improved crop varieties. The Illinois scientists aim to test that potential.
“My country has some of the most polluted cities in the world. I would be a fool to buy a gasoline car when I can get an electric car that is just as good�
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“Students need real life examples of proper change in the world. My Model S is a tool of inspiration for young minds.� 72 28
Hello, I’m Molly.
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s an earth science teacher at preparatory school I value my students opinions on the environment. I began to realize that I could not possibly lecture my students about preserving the planet if I drove to school everyday in a gasoline car. After I got my Model S I could show my class that there are alternatives to the dangerous energy sources we use today. I can feel confident knowing that the example I set will make a positive change to the environment. Now the tree faces a new threat: a swiftly changing climate. Temperatures are rising, and Forest Service researchers estimate that 97 percent of the white bark pine’s natural range will disappear from the United States by 2100. Traditionally, conservation biologists have sought to protect endangered plants and animals where they live, creating refuges where species can be shielded from threats like hunting and pollution. But a refuge won’t help the white bark pine, and so now scientists are pondering a simple but radical new idea: moving the trees to where they will be more comfortable in the future. Their plan calls for rebuilding white bark pine populations by planting seedlings and setting
controlled fires. Healthy forests of white bark pine, they argue, should be better able to withstand climate change. The trees may even spread northward as higher latitudes develop a suitable climate. But in 2007, Sally N. Aitken, a geneticist at the University of British Columbia, realized that she could test the idea. One recent day, as the summer sun beat down, Dr. Leakey led a tour through 80 acres of corn, soybeans and millet. Pipes, hoses and electrical cables snaked through the plots, and hightechnology equipment hummed inside garden sheds that cause earthquakes.
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JB Straubel
Chief Technical Officer The story of JB’s career started at a junkyard in Wisconsin, where, at the age of 14, he discovered a discarded electric golf cart and decided to rebuild it. Thus began a lifelong fascination with energy work and electric vehicles.
Gilbert Passin
Vice President, Manufacturing
Jerome Guillan
Vice President, Sales Jerome leads sales and service worldwide for Tesla. Jerome is focused on providing a delightful sales, delivery, and service experience which the Tesla customers are proud to recommend.
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Gilbert brings 23 years of international automotive experience to Tesla. He has led some of the most high-profile divisions at Toyota, Volvo, Mack and Renault across North America and Europe.
Jay Vijayan
Chief Info Officer Jay champions IT as an enabler for Tesla and works with all the company’s groups to identify opportunities, structure, develop and deliver systems and solutions.
Franz Von Holzhausen Chief Designer
Franz is responsible for driving the overall design direction of Tesla, and is charged with establishing a world class design competency for all future Tesla design concepts and production vehicles.
Meet the Tesla Team 31 23
Last Year Kicked Ass
This is our 2014 Financial summary. We can’t wait to show you. Did I make mistakes? You betcha! What I wouldn’t give to have my 30-year-old self to be able to give my 20-year-old some valuable financial tips and advice on animals. Millennials are sometimes seen as the unfortunate generation. It often seems that the baby boomers took always standing in line for what’s left just ahead of us. But there’s nothing to be gained from moping about circumstances beyond your control -- those things just mean you’ll have to change tactics and work a bit harder. ahead faster than you thought
Here’s how 2014 stacks up . In my 20s, I knew everything. Scratch that. I thought I knew everything. My parents did their best to pass some of their wisdom on to me, but I was too proud to listen. And frankly, I thought I could handle adult life on my own. Did I make mistakes? You betcha! What I wouldn’t give to have my 30-year-old self to be able to give my 20-year-old some valuable financial tips and advice on animals. Millennials are sometimes seen as the unfortunate generation. It often seems that the baby boomers took the best of everything, and Gen X is always standing in line for what’s left just ahead of us. But there’s nothing to be gained from moping
At their center, the people said, the investigations are examining whether dealerships are inflating borrowers’ income or falsifying employment information on loan applications to ensure that anyone, no matter what their credit quality, can buy a car. Some of the same dynamics — the seemingly insatiable demand for loans as the market heats up and the dwindling pool of qualified borrowers — that helped precipitate the 2008 mortgage crisis are now playing out, albeit on a smaller scale, in the auto loan market. Under pressure to generate more and more loans, salesman at some used-car dealers are suspected of getting inventive with cars.
about circumstances beyond your control -- those things just mean you’ll have to change tactics and work a bit harder. My advice: Start with this agenda of 29 financial tips. If you make enough of them part
If loan applications are falsified, leading borrowers to ultimately fall behind on their bills, that could spell trouble for investors, which include insurance companies and public pension funds.
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2014
2013
2012
2011
2010
$4,123.4 2.7% 550.55 23.2 389.4
4,014.2 8.6% 578.3 21.5 407.8
$3,697.8 10.8% 540.3 25.4 374.2
$3,336.8 4.5% 509.8 25.5 370.2
$3,192.1 0.5% 466.9 16.3 299.8
For the year Net sales Percent increase Operating income Income from uncosolidated operations Net income
Per Common Share Earning per share-diluted Earnings per share-basic Common dividends declared Closing price, non-votiong shares-end of year Book Value per share
$
2.91 2.94 1.39 69.00 14.85
$
3.04 3.07 1.27 64.56 12.83
$
2.79 2.82 1.15 48.70 12.17
$
2.75 2.79 1.06 44.01 11.00
$
2.27 2.29 0.98 35.68 10.19
At Year-End Total assets Current debt Long-term debt Shareholders equity
$4,449.5 214.14 1,019.0 1,947.7
$4,165.4 392.6 779.2 1,700.2
$4,087.8 222.4 1,029.7 1,618.5
$3,419.7 100.4 779.9 1,462.7
$3,387.8 116.1 875.0 1,343.5
40.4% 13.4% $ 99.9 106.0 177.4
40.3% 14.4% $ 110.3 102.8 132.2
41.2% 14.6% $ 96.7 98.3 89.3
42.5% 15.3% $ 89.0 95.1 82.5
41.6% 14.6% $ 82.4 94.3 80.54
Other Financial Measures Percentage of net sales Gross profit Operating income Capital expenditures Depreciation and amortization
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CONSOLIDATED INCOME STATEMENT
for the year ended November 30 (millions except per share data)
Net sales Cost of goods sold Gross profit Selling, general and administrative expense Special charges Loss on voluntary pension settlement Operationg income Interest expense Other income, net Income from consolidated operations before income taxes Income taxes Net income from consolidated operations Income from unconsolidated operations Net income Earnings per share—basic Earnings per share—diluted
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2014
2013
2012
$4,123.4 2,457.6
$4,014.2 2,396.4
$3,697.6 2,175.1
1,665.5 1,075.0 25.0 15.3
1,617.8 1,039.5 — —
1,522.5 982.2 — —
550.5 53.3 2.2
578.3 54.6 2.4
540.3 51.2 2.3
499.4 133.6
526.1 139.8
491.4 142.6
365.8 23.2
386.3 21.5
348.8 25.4
$ 389.0 $ 2.94 $ 2.91
$ 407.8 $ 3.07 $ 3.04
$ 374.2 $ 2.82 $ 2.79 37 83
Our Contacts 73 38
Tesla Headquarters Tesla Motors, Inc 3500 Deer Creek Rd
Tesla Factory 45500 Fremont Blvd. Fremont, CA 94538
Contact Tesla Motors Phone: (650) 681-5000 Fax: (650) 681-5101
Website www.teslamotors.com
Tesla Europe ITO Tower, 11th Floor, Gustav Mahlerplein 76A, 1082 MA, Amsterdam Netherlands +31 20 258 3916
Tesla Asia/Pacific 2-23-8, Minami Aoyama Tokyo, Japan Tel: +81 3 6890 7700
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This book was printed on 100% recycled paper.