Tesla Inc. is growing faster than any other auto maker—just not always in ways stockholders would want. The company’s debt has surged just as fast as sales, while profits remain elusive.
Tesla’s debt outstanding
August 2017
Tesla debt hits $10 billion after company issues $2.8 billion of bonds in five months as it struggles to meet production targets.
$10 billion
9
November 2016
Tesla doubles debt by acquiring SolarCity, assuming $3.6 billion of liabilities from the financially challenged home-solar company.
8
7
February 2014
Tesla quadruples debt load with $2 billion of bonds to fund Model S and Gigafactory. Sales surge amid production delays.
6
5
4
3
Other
SolarCity convertible bond
2
SolarCity debt
Tesla convertible bond
1
Tesla debt
0
’15
’16
’17
’18
2010
’13
’12
’11
’14
August 2017
Tesla debt hits $10 billion after company issues $2.8 billion of bonds in five months as it struggles to meet production targets.
Tesla’s debt outstanding
$10 billion
9
8
November 2016
Tesla doubles debt by acquiring SolarCity, assuming $3.6 billion of liabilities.
7
6
February 2014
Tesla quadruples debt load with $2 billion of bonds to fund Model S and Gigafactory. Sales surge amid production delays.
5
4
3
Other
SolarCity convertible bond
2
SolarCity debt
Tesla convertible bond
1
Tesla debt
0
’11
’12
’13
’14
’15
’16
’17
’18
2010
Tesla’s debt outstanding
August 2017
Tesla debt hits $10 billion after company issues $2.8 billion of bonds in five months as it struggles to meet production targets.
$10 billion
9
November 2016
Tesla doubles debt by acquiring SolarCity, assuming $3.6 billion of liabilities from the financially challenged home-solar company.
8
7
6
February 2014
Tesla quadruples debt load with $2 billion of bonds to fund Model S and Gigafactory. Sales surge amid production delays.
5
4
3
Other
SolarCity convertible bond
2
SolarCity debt
Tesla convertible bond
1
Tesla debt
0
2010
’11
’12
’13
’14
’15
’16
’17
’18
Tesla’s debt outstanding
$10 billion
Other
9
SolarCity convertible bond
SolarCity debt
8
Tesla convertible bond
7
Tesla debt
6
5
4
3
2
1
0
’13
2010
’15
’14
’12
’11
’17
’16
February 2014
Tesla quadruples debt load with $2 billion of bonds to fund Model S and Gigafactory. Sales surge amid production delays.
November 2016
Tesla doubles debt by acquiring SolarCity, assuming $3.6 billion of liabilities from the financially challenged home-solar company.
August 2017
Tesla debt hits $10 billion after company issues $2.8 billion of bonds in five months as it struggles to meet production targets.
Source: SEC filings
The electric-car maker booked a record $11.8 billion in revenues last year, as it began to launch its highly anticipated Model 3 sedan, up nearly sixfold from 2013. That growth has led stock investors to bless Tesla with a $57 billion market value, which rivals much larger companies like Ford Motor Co. and General Motors Co.
CEO Elon Musk predicted last week that production of the Model 3 would hit 5,000 cars a week in June and the company would start generating cash flow in the third quarter.
Tesla’s cash bleed has accelerated since the Model 3 rolled out last year.
But Tesla has also taken on more than $10 billion of debt to make up for manufacturing problems—and to recapitalize Mr. Musk’s home-solar company SolarCity—and $1.25 billion falls due next year.
That makes Tesla’s fight to generate profits much more urgent than some shareholders might realize. Mr. Musk said Tuesday that the company would cut about 9% of its workforce to save money.
A key measurement of Tesla’s liquidity has weakened in recent quarters.
Write to Matt Wirz at matthieu.wirz@wsj.com and Charley Grant at charles.grant@wsj.com
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