Exhibit 99.1

 

 

Tesla Second Quarter 2019 Update

 

    Cash and cash equivalents of $5.0B; Operating cash flow less capex of $614M

 

    GAAP operating loss of $167M, GAAP net loss of $408M, including $117M of restructuring and other charges

 

    Auto gross margin at ~19% in spite of reductions in vehicle ASP and lower regulatory credit revenue

 

    On track to launch Gigafactory Shanghai by end of 2019 and Model Y by fall of 2020.

 

In the second quarter of 2019, we achieved record deliveries of 95,356 vehicles and record production of 87,048 vehicles, surpassing our previous quarterly records of ~91,000 deliveries and ~86,600 units produced in Q4 of 2018. This is an important milestone as it represents rapid progress in managing global logistics and delivery operations at higher volumes.  

 

As a result of this growth and operational improvements, we generated $614 million of free cash flow (operating cash flow less capex) in Q2. Combined with our public offering of equity and convertible bonds (net proceeds of $2.4 billion), we ended the quarter with $5.0 billion of cash and cash equivalents, the highest level in Tesla’s history.  This level of liquidity puts us in a comfortable position as we prepare to launch Model 3 production in China and Model Y production in the US. As a result of our strong deliveries and continued progress on cost efficiencies, our GAAP net loss declined significantly compared to Q1.  

 

 

Autopilot and Full Self-Driving Features: As safety has always been a priority for us, Model 3 received the highest ever ratings in the Safety Assist category of Euro NCAP’s new and more stringent testing protocols. New active safety features built on our Autopilot and Full Self-Driving (FSD) hardware and software suite contributed to this achievement. Development of new features continued in Q2 as we launched Navigate on Autopilot in new regions including Europe and China. We are making progress on our next major update: Enhanced Summon, which is currently in our early access program. We are making progress towards stopping at stop signs and traffic lights. This feature is currently operating in “shadow mode” in the fleet, which compares our software algorithm to real-world driver behavior across tens of millions of instances around the world. Our new FSD computer, which is ~21x faster than our previous HW2.5 computer, has been in production since Q2.

 

Model 3: In Q2, Model 3 deliveries reached an all-time record of 77,634. Not only was Model 3 once again the best-selling premium vehicle in the US, outselling all of its gas-powered equivalents combined, this product also gained traction in other markets. In Europe, Model 3 is approaching sales levels of established premium competitors. As we stated previously, more than 60% of Model 3 trade-ins are non-premium brands, indicating a larger total addressable market for this product than initially expected.  Now that all current variants of Model 3 are available across North America, Europe and Asia, we are gaining insight into preferred customer trim mix.  

 

 

During the quarter, a majority of orders continued to be for a long-range battery option and the Model 3 average selling price (ASP) was stable at approximately $50,000. At the same time, manufacturing costs continued to decline.  

The production rate of Model 3 continued to improve gradually throughout the quarter, breaking a monthly record in May and then again in June. All manufacturing equipment in Fremont has demonstrated capability of a 7,000 Model 3 vehicles per week run rate, which we continue to work to increase. We aim to produce 10,000 total vehicles of all models per week by the end of 2019.

Model S/X: Model S and Model X production continues to run on a single shift schedule, and we produced over 14,500 vehicles in Q2. Our deliveries increased sequentially to 17,722 as we continue to prioritize inventory reduction (working capital management). As a result, our total new car inventory levels have fallen to just 18 days of sales (including vehicles in transit, on ships and company


The following information was filed by Tesla, Inc. (TSLA) on Wednesday, July 24, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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