Tesla opened credit lines worth $30 billion, according to a regulatory filing today. The loans come at a time when company profits have fallen in recent years and as Tesla targets higher spending in the coming quarters.
During its first decade and a half of operation, Tesla’s sales and revenue basically did nothing but increase. The company grew and grew, at a rapid pace, and basically justified any money spent pursuing further growth with what seemed like almost endless demand as it grew.
That lasted until 2024, when Tesla went from 38% growth the year before to a 1% drop in 2024.
Since then, profitability has been difficult for the company as it has had to post some questionable one-off profits in order to gain profitability. Still, profits have remained low.
A downward pressure on profits has been the biggest amount of capital spending for Tesla as it pursues several fantastical ideas, such as cars without steering wheels, cars that get no performance benefit from flying and the promise of one man controlling a trillion-dollar army of robots.
CapEx more than doubled last quarter and Tesla says it will remain high in the current environment of extremely high spending by technology companies. The company expects to spend a total of $25 billion in 2026 (up from $8.5 billion in 2025), and analysts expect similar CapEx in 2027.
So, given falling profits and rising capital expenditures, Tesla is now taking out a big loan to fill the gap.
Today’s regulatory filing shows that Tesla has obtained a total of $30 billion in credit lines from Citi and Wells Fargo. The loans have terms of between one and five years and replace an earlier $5 billion line of credit that Tesla had previously taken out (but for which it had no current debt).
The company says it doesn’t expect to have to draw on the credit line in 2026, but there are only three months left until the end of 2026 and many expenses are planned for next year.
The loan amounts to a considerable amount of cash, equivalent to about a quarter of Tesla’s revenue at current revenue levels. But compared to Tesla’s earningswhich have been short by a few hundred million in recent quarters, is a much larger amount of money.
Most worryingly, last quarter Tesla had negative cash flow for the first time since the first quarter of 2024, when it experienced a massive drop in sales. Before that, Tesla had been cash flow positive for consecutive years.
So even though Tesla had about $43 billion in cash in the bank according to its latest quarterly report, it felt the need to take out a fairly large loan to finance its operating activities (automotive is a cash-intensive business, after all) and to pay for its investments in various product ideas that may not generate revenue any time soon.
Tesla has had little to show for its CapEx increase so far. While it’s launching three products this month (well, one was delayed), those three products were announced a decade ago in one form or another. One of them is still not working (Cybercab), another has been slow to implement (Semi), and another seems to exist only to sell investors on the hype about the SpaceX merger (Roadster).
Between those and other future products promised by Tesla, it will cost a lot to finance all of these ideas. It remains to be seen if any of them will pay off and if Tesla will need more money to finance them beyond this new $30 billion loan.
Charge your electric vehicle at home using rooftop solar panels. Find a reliable, competitively priced solar installer near you at energywisefree. They have pre-vetted installers competing for your business, ensuring high-quality solutions and 20-30% savings. It’s free, with no sales calls until you choose an installer. Compare personalized solar quotes online and receive guidance from unbiased energy advisors. begin here. – advertisement*
FTC: We use automatic affiliate links that generate income. Further.
