Tesla Motors, the Silicon Valley electric car maker gunning for an initial public offering, has just filed its first amendment to its S-1 — the document filed with regulators as part of its registration for an IPO that details a company’s financial results, risk factors and other aspects of the business. In a filing dated March 26, the startup notes two important developments since it first filed in January to go public: Tesla has begun to draw funds from its federal loan facility, and it has struck a key supply deal that could shrink or eliminate a potential gap in Roadster sales (and dip in revenue from vehicle sales) anticipated for 2012.
Tesla won a conditional commitment from the Department of Energy last summer for $465 million in loans, including approximately $365 million to finance a manufacturing facility for the long planned Model S electric sedan and $100 million to help the company set up manufacturing for battery packs and electric drive trains. Tesla has now updated its prospectus to disclose that in February and March, it received a total of $29.9 million through the government-backed loan facility. So that’s at least seven months between the time of the initial loan announcement (late June 2009) and the first funds actually rolling out the door (February 2010).
Tesla explains that it has to meet several conditions in order to access additional funds over the course of three years, “as eligible costs are incurred.” According to Tesla’s filing, drawing funds for the planned Model S plant requires (among other things) DOE approval of an environmental assessment for the facility, for which the company has yet to announce a location. The loan that’s meant to support development of a new electric powertrain manufacturing facility, meanwhile, hinges in part on “the successful development of commercial arrangements with third parties for the supply of powertrain components.”
Tesla explained in its original registration statement that it did not plan to sell its current generation Tesla Roadster model after 2011, and did not plan to introduce the next generation Roadster until a year after the launch of the Model S (scheduled for 2012), “due to planned tooling changes at a supplier,” likely UK-based Lotus.
Lotus builds “gliders,” or partially assembled vehicles without an electric powertrain, for Tesla’s Asia and U.S. Roadster sales, and fully assembled Roadsters for Tesla’s EU sales. But Tesla says in its amended S-1 that it has now expanded the supply agreement, enabling it to build up to 700 additional current-generation Roadsters before it gets manufacturing up and running for the next-gen model.
Tesla intends to use gliders from Lotus for its Roadster until December 2011 — to fulfill orders placed in 2011 and into 2012, “until our supply of gliders is exhausted.” Tesla’s previous agreement with Lotus was set to expire in March 2011 and was good for a minimum of only 1,700 gliders or fully assembled vehicles. By the end of last year, Tesla had already bought about 1,000 of these. According to Tesla’s amended IPO filing, its new arrangement with Lotus provides for at least 2,400 gliders or vehicles through December 2011.
This filing sheds some more light on the deal that Tesla described in its latest newsletter to customers, saying it had “negotiated agreements with key suppliers that will increase total Roadster production by 40 percent and extend sales into 2012.”