Tesla continues to increase capital expenditures as its development proceeds at a tremendous pace. The company continues to work on a new generation vehicle, expecting an increase in capital expenditures for 2024 of more than $10 billion.
In Tesla’s Form 10-K published on Monday, the company made clear that it will continue to actively work on its growth. According to the information provided, the manufacturer intends to aggressively invest in projects under development.
Tesla’s capital expenditures are generally difficult to predict beyond the short term. This is influenced by the fact that the company is developing in several areas and has many projects, each of which may be further impacted by the uncertainty of future global market conditions. In parallel with this, Tesla is ramping up new products, building or ramping up manufacturing facilities on three continents, piloting the development and manufacture of new battery cell technologies, expanding its Supercharger network, and investing in autonomy and other artificial intelligence enabled training and products. The company emphasized that the pace of its capital expenditures may vary depending on overall priority among projects, the pace at which it meets milestones, production adjustments to and among its various products, increased capital efficiencies, and the addition of new projects.
Taking into account all factors and announced projects in the pipeline, all other ongoing infrastructure projects and varying inflation rates, Tesla currently expects its capital expenditures to exceed US$10 billion in 2024. This shows an increase compared to previous years. For example, the company predicted capital expenditures for 2023 in the amount of $6 billion to $8 billion, while for 2024 the previous expectations were from $7 billion to $9 billion. However, Tesla has adjusted its forecast for this year to take new factors into account. Meanwhile, the expected capital expenditures for 2025 and 2026 will range from $8 billion to $10 billion per year.
Tesla explained that its business consistently generates cash flow from operations in excess of its capital expenditure levels. The company has and will continue to use such cash flows to, among other things, increase vertical integration, expand its product roadmap, and provide financing options to its customers. Tesla expects its ability to self-finance to continue as long as macroeconomic factors support its current trends in sales.
