Tesla Inc. plans to raise as much as $5 billion through new sales of stock, capitalizing on a market tear that has sent its shares zooming this year.
The Palo Alto, Calif.-based electric-vehicle company said Tuesday that it would sell the additional shares over time at market prices. The company raised the same amount of money through a similar program it rolled out in September.
Tesla’s share price is more than nine times higher than it was a year ago after adjusting for a recent stock split, as the company has been able to improve its liquidity and keep its streak of profitable quarters going—now up to five—amid the coronavirus pandemic. Last month, S&P Dow Jones Indices said Tesla would be added to the S&P 500 index in December, boosting the stock’s mainstream appeal.
The fundraising coincides with significant investments in the company’s production capacity. Tesla is planning to start work on a new U.S. factory in Austin, Texas, and is also building a plant in Berlin.
Plans to boost capacity contributed to Tesla’s projections for capital spending in 2021 and 2022. In October, Tesla’s finance chief, Zachary Kirkhorn, told analysts the company expects capital spending of $2 billion to $2.5 billion in each of the next two years.
