Tesla 2012 Annual Report Download - page 89

Table of Contents
and Asia, coupled with slightly higher average selling prices. Under our supply agreement with Lotus, we have built 2,500 Roadster gliders. We
plan to sell our remaining Tesla Roadsters primarily in Europe and Asia during 2012 until our inventory is depleted.
In February 2010, we began offering a leasing program to qualified customers in the United States for the Tesla Roadster. Through our
wholly owned subsidiary, qualifying customers are permitted to lease the Tesla Roadster for 36 months, after which time they have the option of
either returning the vehicle to us or purchasing it for a pre-determined residual value. We account for these leasing transactions as operating
leases and accordingly, we recognize leasing revenues on a straight-
line basis over the term of the individual leases. Lease revenues are recorded
in vehicle, options and related sales within automotive sales revenue and for the years ended December 31, 2011 and 2010, we recognized $3.0
million and $0.8 million, respectively. During the years ended December 31, 2011 and 2010, approximately 6% and 14% of the vehicles
delivered during those years were under operating leases. As of December 31, 2011 and 2010, we had deferred revenues of $0.8 million and $1.1
million of down payments which will be recognized over the term of the individual leases, respectively.
Powertrain component and related sales for the year ended December 31, 2011 were $46.9 million, an increase from $21.6 million for the
year ended December 31, 2010. The increase in powertrain component and related sales was primarily due to significant shipments of battery
packs and chargers to Daimler. We began delivering battery packs and chargers for the Daimler Smart fortwo EV program at the end of 2009,
and for the Daimler A-Class EV program late in the fourth quarter of 2010. Production for both the Smart fortwo and A-Class EV programs was
completed as of December 31, 2011.
Automotive sales for the year ended December 31, 2010 were $97.1 million, a decrease from $111.9 million for the year ended
December 31, 2009. Vehicle, options and related sales for the year ended December 31, 2010 were $75.5 million, a decrease from $111.5 million
for the year ended December 31, 2009.
During the first three quarters of 2009, we continued to fulfill reservations for the Tesla Roadster and we had made a significant effort to
increase our production capacity in order to accelerate deliveries to customers who had been on our waitlist for a significant amount of time. As
a result, a significant portion of the revenue recognized during the first three quarters of 2009 came from fulfilling reservations placed prior to
2009. Beginning with the fourth quarter of 2009, sales of the Tesla Roadster began more closely approximating the level of orders placed during
the quarter. Consequently, the comparison of revenue for the year ended December 31, 2010 versus the year ended December 31, 2009 may not
be meaningful. Similarly, ZEV credit sales which are included in vehicle, options and related sales, were higher during the year ended
December 31, 2009 as the fulfillment of a significant number of reservations allowed us to sell a larger number of ZEV credits. The year over
year decrease in vehicle deliveries was partially offset by higher selling prices from an expanded offering of vehicle options to our customers as
well as higher average selling prices outside of the United States.
Powertrain component and related sales for the year ended December 31, 2010 were $21.6 million, compared to $0.4 million for the year
ended December 31, 2009. During the year ended December 31, 2009, we were selected by Daimler to supply it with battery packs and chargers
to support a trial of the Smart fortwo EV program in a least five European cities. We began delivering and recognizing revenue for these
production battery packs and chargers at the end of 2009.
Prior to 2010, most of our revenues had been generated through sales of our vehicles in the United States and we had no revenues from
sales outside of the United States prior to the third quarter of 2009. Our international sales commenced with the launch of the Tesla Roadster in
Europe in July 2009 and since then, we have recognized revenue from sales of the Tesla Roadster in additional countries including Canada,
Japan and Hong Kong. For the years ended December 31, 2011, 2010 and 2009, 49%, 55% and 19% of our revenue from vehicle, options and
related sales, respectively, were derived outside of the United States. For the same periods, all of our powertrain component and related sales
were derived outside of the United States.
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