Ok, I’m going to do some *very fuzzy* napkin math. I know that this is not how it actually works (real world numbers are far more complex and my numbers won’t even try to account for product mix) but serves for some kind of approximation.
As I said earlier, Tesla’s FCF was a big positive for myself in Q2. However, as people mentioned there was a huge vehicles in transit at end of Q1 coupled with the fact that Tesla also sold more than they built, which is certainly a quarterly exception. I wanted to try to *very roughly* approximate what FCF would be if this was a more standard quarter.
- Q2 deliveries: 95,356
- Q2 production: 87,048
- FCF: $613,929,000
- FCF/delivery: $6,438
Now that we have a FCF/vehicle sold number, I can calculate what FCF would be if this was a more usual quarter. Tesla being a growing company should *on average* have at least 1 week more production than deliveries. Let’s say 7,000 - 14,000 deliveries.
If Tesla kept the same FCF/deliveries ratio and only sold 80,000 cars. FCF = $515,000,000
If Tesla kept the same FCF/deliveries ratio and only sold 73,000 cars. FCF = $470,000,000
I could live with either of these numbers. In fact, I think they are both phenomenal, as I see FCF for Q2.
Obviously things are far more complex, especially considering Tesla probably expenses a lot of the European shipping costs that were hanging over in Q1 in Q1.
However, FCF/delivery should also improve as GM improves.
Hope I didn’t trigger any OCD accountant minds on this board with my fuzzy math.