Tesla’s management hinted that it could be coming during last week’s conference call with financial analysts discussing second quarter 2017 results.

While Tesla said that it wouldn’t raise more capital through equity, it opened the door to revisit another round of debt through senior notes.

Today, the company confirmed that they are raising $1.5 billion in debt in order to fund the expansion of Model 3 production.

They wrote in a press release today:

“Tesla today announced that it intends to offer, subject to market and other conditions, $1.5 billion in aggregate principal amount of its senior notes due 2025 (the “Notes”). The Notes will be senior unsecured debt obligations of Tesla. The interest rate, redemption prices and other terms of the Notes are to be determined.

Tesla intends to use the net proceeds from this offering to further strengthen its balance sheet during this period of rapid scaling with the launch of Model 3, and for general corporate purposes.”

Last week, Tesla said that it was planning to spend about $2 billion in capital expenditures during the second half of the year as they ramp the production of Model 3.

While Tesla has made some large investments in its production capacity and service expansion before, it is unprecedented for the company at this scale.

At the end of last quarter, Tesla had a cash position of $3 billion, but CEO Elon Musk said that he would like to keep to cash position over $1 billion and therefore, debt raising was a possibility to prevent the upcoming increase in expenditures to make too big of a hole in their cash position.

Tesla aims for the large amount of money to help them bring their current production capacity of roughly 100,000 cars per year to an annual production rate of 500,000 by the end of next year.

While it’s a lot of money, it could more than double the company’s revenue to over $20 billion per year, according to their projections.

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