Analysis of Company’s Financial Situation: Taking Tesla Company as an Example

Yuxiao Li ()
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Yuxiao Li: Southwestern University of Finance and Economics, School of Accounting

A chapter in Proceedings of the 2025 International Conference on Financial Innovation and Marketing Management (FIMM 2025), 2025, pp 845-852 from Springer

Abstract: Abstract This study, set against the backdrop of the rapid expansion and intensifying competition in the global electric vehicle industry, analyses Tesla’s financial performance (2018–2024) to assess its economic health, inventory management, and profitability amid rapid EV industry growth and competition. Findings reveal Tesla’s total assets quadrupled to 122 billion by 2024, fueled by global expansion and technological innovation. Due to price wars, delayed product refreshes, and market saturation, net profits in 2024 dropped by 53% to 7.15 billion. Inventory management followed an “expand- next- optimize” design, rising to 12.84 billion in 2022 from Gigafactory developments and supply chain disruptions, before declining 11.8% in 2024 via AI-driven need modelling, giga casting adoption, and strategic price cuts. Despite operating changes, Tesla’s inventory turnover ratio decreased to 8.05x in 2024, surpassing BYD’s 12.4x, reflecting over-reliance on raw materials and geopolitical risks. According to the analysis, Tesla must balance creativity and cost effectiveness. Recommendations include expanding cheap models, optimizing AI-based generation scheduling to minimize inventory, and enhancing partnerships in important areas like China (36.7% of global EV sales). Reducing mechanical margins by expanding revenue through the energy and solutions segments is crucial. This study provides stakeholders insight into Tesla’s attractiveness in an evolving market. It emphasizes the necessity of aligning economic tactics with market dynamics in the capital-intensive EV business.

Keywords: Tesla; Financial Statement Analysis; Inventory Management; Profitability; Electric Vehicle Industry (search for similar items in EconPapers)
Date: 2025
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DOI: 10.2991/978-94-6463-874-5_97

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