Tesla 2015 Annual Report Download - page 57

Liquidity and Capital Resources
As of December 31, 2014, we had $1.91 billion in principal sources of liquidity available from our cash and cash equivalents including
$1.27 billion of money market funds. Amounts held in foreign currencies had a US dollar equivalent of $315 million as of December 31, 2014,
and consisted primarily of Chinese yuan, Japanese yen, euro and Norwegian krone.
Sources of cash are predominately from our deliveries of Model S, as well as customer deposits for Model S and Model X, sales of
regulatory credits, cash from the provision of development services, and sales of powertrain components and systems. We expect that our current
sources of liquidity, including cash and cash equivalents, together with our current projections of cash flow from operating activities, will
provide us with adequate liquidity over the next 12 months based on our current plans. These cash flows enable us to fund our ongoing
operations, research and development projects for our planned Model X, Model 3, and certain other future products; purchase tooling and
manufacturing equipment required to introduce Model X and to continue to ramp up production of Model S; construct our Gigafactory; and
establish and expand our stores, service centers and Supercharger network. We currently anticipate making aggregate capital expenditures of
about $1.5 billion over the next 12 months.
When market conditions are favorable, we may evaluate alternatives to pursue liquidity options to fund capital intensive initiatives.
Should prevailing economic, financial, business or other factors adversely affect our ability to meet our operating cash requirements, we could be
required to obtain funding though traditional or alternative sources of financing. We cannot be certain that additional funds would be available to
us on favorable terms when required, or at all.
Summary of Cash Flows
Cash Flows from Operating Activities
Our cash flows from operating activities are significantly affected by our cash investments to support the growth of our business in areas
such as manufacturing, research and development and selling, general and administrative. Our operating cash flows are also affected by our
working capital needs to support growth and fluctuations in inventory, personnel related expenditures, accounts payable and other current assets
and liabilities.
Our operating cash inflows include cash from sales of our Model S, customer deposits for Model S and Model X, sales of regulatory
credits, cash from the provision of development services, and sales of powertrain components and systems. These cash inflows are offset by
payments we make to our suppliers for production materials and parts used in our manufacturing process, employee compensation, operating
leases and interest expense on our financings.
Cash provided by (used in) operating activities was ($57.3) million, $264.8 million and ($263.8) million in 2014, 2013 and 2012. The
decrease in operating cash flows in 2014 as compared to 2013 was due to an increase in finished goods inventory primarily due to cars whose
delivery slipped from Q4 of 2014 to the following year, an increase in raw material inventory balances at year end necessary to meet our planned
production requirements for Model S in Q1 of the following year, higher operating expenses in R&D and SG&A, and use of cash for vehicles
directly leased by us, partially offset by increased cash receipts from customer payments on vehicle sales, including an increase in customer
deposits.
The increase in operating cash flows in 2013 as compared to 2012 was due to an increase in cash receipts from customer payments on
vehicles deliveries, including for cars sold under our Resale Value Guarantee program, increased regulatory credits sold and increased customer
deposits from orders for Model S and X. This was partially offset by an increase in inventory balances at year-
end necessary to meet our planned
production requirements for Model S in Q1 of the following year.
Customer Deposits
We collect deposits from customers at the time they place an order for a vehicle and, in some locations, at certain additional milestones up
to the point of delivery. Customer deposit amounts and timing vary depending on the vehicle model and country of delivery. Customer deposits
related to Model X still represent fully refundable reservations. Amounts are included in current liabilities until refunded or until they are applied
to a customer’s purchase balance at time of delivery. As of December 31, 2014, we held $257.6 million in customer deposits.
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Year Ended December 31,
2014 2013 2012
Net cash provided by (used in) operating activities
$
(57,337
)
$
264,804
$
(263,815
)
Net cash used in investing activities
(990,444
)
(249,417
)
(206,930
)
Net cash provided by financing activities
2,143,130
635,422
419,635