Tesla plans to raise additional funds by selling debt backed by car leases, and reports say the price for the debt sale could be determined as early as next week.
Bloomberg reported Thursday, citing people familiar with the matter and requesting anonymity, that Tesla is already premarketing a $783 million debt sale backed by leases from prime borrowers. The sale is reportedly being led by France’s Société Générale, with a price officially expected to be announced next week.
Bloomberg also explained that Tesla set up a $750 million ABS contract with a 5.53 percent coupon on the top tranche.
Asset-backed securities (ABS) sales are becoming increasingly common among automakers, and this particular debt sale marks Tesla’s second such transaction this year. The deal gave Tesla access to liquid financing without incurring other debt, which could potentially further burden the company.
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Tesla’s total securitization totaled about $4 billion last year, but the company doesn’t use securitization as frequently as many traditional automakers. Ford, for example, just offered a deal price of $1.7 billion on Thursday.
The news comes ahead of Tesla’s robotaxi unveiling event on Thursday dubbed “We, Robot,” which many expect to be a pivotal moment for the company. Tesla has been teasing a robotaxi platform based on its camera-based fully self-driving (FSD) software for years, and the company highlighted an early look at its ride-hailing robotaxi platform earlier this year.
Tesla is also scheduled to report third-quarter results on October 23, but the company already reported earlier this week that it delivered 462,890 vehicles in the third quarter. The company also announced that it has installed 6.9 gigawatt hours of Megapack and Powerwall energy storage products. This means that Tesla has exceeded its energy usage for all of 2023 with one quarter left.
Tesla’s upcoming third quarter earnings report can be found on the company’s Investor Relations site here.
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