Tesla Motors Company, Inc. began operations in 2003 but did not begin selling its stock to the public until June 28, 2010. It has lost money every year it has been in existence, and by December 31, 2013, it had total lifetime losses of approximately $1.1 billion. The company makes the Tesla Model S, and it supplies electric car components to Daimler and Toyota. Tesla's statements of cash flows for 2011, 2012, and 2013 follow.

Required
a. As this chapter explained, many companies that report net losses on their earnings statements report positive cash flows from operating activities. How do Tesla's net incomes compare to its cash flows from operating activities?
b. Based only on the information in the statements of cash flows, does Tesla appear to be growing the capacity of its business? Explain.
c. In 2013 Tesla paid off $452.3 million on Department of Energy (DOE) loans and $8.4 million of capital leases and other debt. Where did it get the funds to repay this debt?
d. All things considered, based on the information in its statements of cash flows, does Tesla's cash position appear to be improving or deteriorating?

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TESLA MOTORS, INC. Consolidated Statements of Cash Flows in thousands) For the Years Ended December 31 2012 $(396,213) 2013 2011 Cash flows from operating actlvltles: Net loss 4,014) (254,411) Adjustments to reconcile net loss to net cash used in operating activities: 106,083 80,737 Depreciation and amortization Stock-based compensation Amortization of discount on convertible debt Inventory write-downs Write-off of Department of Energy (DOE) loan origination costs Change in fair value of DOE warrant liabilities 16,919 29,419 50,145 1,828 5,558 (10,692) Other noncash operating activities Foreign currency transaction gain Change in operating assets and liabilities 3,611 3,655 Account receivables (17,303) Inventories and operating lease vehicles (463,270) (13,638) Prepaid expenses and other current assets 482) 187,821 9,603 Other assets Accounts payable 19,891 66,567 268,153 24,243 236,299 32,971 257,994 Accrued liabilities Deferred revenue Customer deposits 47,056 61,006 Resale value guarantee 10,255 266,081 Other long-term liabilities Net cash provided by (used in) operating activities 128,034 Cash flows from Investing activitles: Purchases of property and equipment excluding capita eases Withdrawals out of our dedicated DOE account, net Increase) decrease in other restricted cash Purchase of marketable securities Maturities of short-term marketable securities (264,224) 14,752 (184,226) 50,121 (3,201) 64,952) 40,000 (162,258) 40,000 Net cash provided by investing activities 249,417) Cash flows from financing activitles: Proceeds from convertible debt Proceeds fro Proceeds from issuance of warrants Proceeds from exercise of stock options and other stock issuances Proceeds from issuance of common stock in private placement Principal payments on DOEloans Purchase of convertible note hedges Common stock and convertible debt issuance costs Principal payments on capital leases and other debt Proceeds from DOE loans Net cash provided by financing activities 660,000 360,000 120,318 95.307 55,000 (452,337) 177,540) (16,901) m issuance of common stock in public offering 1124 59,058 (12,710) (2,832) 188,796 419,635 (53,376) 255,266 $ 201,890 204,423 446,000 635,422 643,999 Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period 99,558 $ 255,266 $ 845,889