Tesla Forecasting

INTRODUCTION

In this paper, our main intention is to provide a concise financial analysis of Tesla Motors Incorporated. We will do so by calculating and providing liquidity, profitability, and solvency ratios and then evaluating those results. Tesla’s long-term goals strategy is to create affordable mass-market electric vehicle (EV). To accomplish the goal, Tesla has to increase the number and variety of EVs available to mainstream consumers in several ways:

Tesla Strategy

Tesla’s Key treats

• Selling its own vehicles in showrooms (operates in stores or galleries) and online (Direct sales, avoiding regular dealers).

• Selling patented electric powertrain components to other auto manufactures, so that they may get their own EVs to customers sooner;

• Serving as a catalyst and reflecting a positive example to other automakers, demonstrating that is a good consumer demand for vehicles that are both eco-friendly with performance and efficiency.

• Tesla has shown that electric cars can be fast, luxurious and very desirable.

• Building a battery gigafactory - factory will have supply output of 500,000 vehicles by 2020.

• 98% of Tesla owners said they would buy a Tesla again.

• Huge opportunity in the Chinese market. More Chinese entering the middle class and living in polluted urbanized areas. • Selling direct to customers, the store can’t adequately trade-ins.

• Their lack of inventory means that the buyers will always have to wait for their car to arrive.

• Customers are cautious buying car from “new” brand, especially cars with lifespan of battery.

• The return of Fisker, a “Chinese Tesla” is about to enter the market as stronger competitor

• Toyota’s Hydrogen car- a new technology of clean-burning hydrogen fuel cell.

• $20 oil per barrel- this is one of the biggest threat to electric vehicles, a collapse in oil prices to #20 per barrel.

• Apple to compete in electric car space - product launch anticipated for 2019.

• Audi & Porsche also looking to compete in all electric luxury space.

RATIO ANALYSIS:

The calculated ratios will show Tesla’s’ ability to meet its short-term debt obligations (liquidity), performance in relation to sales, assets, and profits or losses (profitability), and the resulting income amount after tax deductions against the