Well, that's a question I raised before:
Even if Tesla got cash-backs in Q2 2015 (e.g. state incentives, sell and lease back operations...) basic accounting rules call for cash expenses to be booked and _not_ netted out directly, no?!
The numbers therefore still don't make sense to me:
In any case, assuming upper numbers, this will only amount to a total investment of around $400 million until 2016 (since Tesla announced they will only spend "up to $190 million" in Q3 and Q4 of 2015 on the GF project) and their total investment according to the latest 10-Q is as follows:
That is obviously only a fraction of what the GF is supposed to cost in total until 2020 ($5 billion).
In summary, here's a huge gap to be filled between 2016-2020: About $4.4 billion!
That's assuming that Panasonic invests $200 million until the end of 2015 (see Paulo Sousa's recent SA article for sources or quoted below*) and Tesla the upper $400 million until the same date (both are rounded numbers).
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* "Panasonic was committing to little around $200 million or so in Gigafactory investment (
tens of billions of yen - forget about the
$480 million number that's bandied about as that refers to the investment in the entire automotive operations). If Tesla cuts its own investment, why would the other suppliers keep their own commitments?"
It is probably more instructive to examine the Gigafactory in phases. Originally, the Gigafactory was 35 GWh of cell production, 50 GWh of battery production. Originally in 5 phases, which is 7 GWh each. Presumably Panasonic supplies at least 7 GWh of this from the existing Osaka plants.
Total cost was to be $4 to $5 billion, with $1 billion coming from the state in terms of tax cuts, rebates, etc. So the actual construction costs were to be $3 billion to $4 billion. Part of this is Tesla's part, around $1.5 to 2 billion. There's up front land and clearing cost and infrastructure to get started, say $100 million. Since then, Tesla has added a floor in there, so the costs are probably on the higher side since this is going to be a bigger factory than originally proposed.
So taking the high side... $4 billion in construction costs, $780 million per phase + $100 million up front clearing and land. That means this first portion for Tesla is probably about $490 million and Panasonic's is $390 million. The timing is such that Tesla's spend for this phase is front loaded, with Panasonic's being back loaded with the first phase opening sometime in Q2, 2016. The actual breakdown is expected to be $1.1 billion in the factory itself and another $3.9 billion in equipment.
Costs for the Gigafactory include construction costs, land costs, equipment costs, labor costs and so forth. In Tesla's filings, they refer to construction costs, to opex labor costs, to land costs, and so forth.
From the latest 10-Q, the capex cash spend for the Gigafactory construction is expected to be $300 million for 2015.
Here are the construction costs listed so far from their reports:
end of 2014: $106.6 million
Q1: $146.2 million
Q2: $206.6 million
I think there is confusion because construction costs != total costs. Also, there are places where they talk about spending cash towards the Gigafactory, but that's just showing how much of their cash pile went to it, not a total spend amount. Total costs obviously include land and opex (Tesla employee labor), but that hasn't been broken out.
Panasonic's costs cannot have been very significant up until the point where the plant is ready to take equipment. As it turns out, the completion date of the first phase is soon after Panasonic's 2016 fiscal year (April 2015 to March 2016). According to Panasonic's latest annual report, they are going to spend 165 billion yen in strategic investments in their Automotive and Industrial Systems (AIS) company. 60% of that is automotive related. That's $832 million dollars using today's exchange rate. Assuming the Ficosa International acquisition comes from that amount, we subtract $275 million. That leaves $557 million left for the Gigafactory and other investments. That leaves plenty of room for the roughly $400 million necessary for phase 1 of the Gigafactory. Here is the direct quote from the annual report:
Plans are in place for capital investments in fiscal 2016 to total 165 billion yen*, exceeding the level undertaken during fiscal 2015 by a factor of 1.5. This includes investments in the construction of a lithium-ion battery plant in Tesla’s Gigafactory in North America. Approximately 60% of total investments will be directed toward the automotive field in order to accelerate the pace of growth.
Panasonic, like many companies in the Asia does not provide much specifics beyond the current fiscal year.
So, in summary, for phase 1, we're looking at maybe $900 million in costs for phase 1. Tesla has already spent $206.6 million in construction costs + a chunk of opex. They are looking to spend about $200 million more this year, bringing their part to about $410 million of the estimated $490 million. Panasonic is looking to spend $557 million in strategic investments through March 31, 2016, of which the Gigafactory is presumably a huge chunk of that. So phase 1 looks like it's shaping up.