Tesla Inc (NASDAQ:TSLA) is sounding out investors over a possible securitisation of another US$1.8 billion worth of customer electric vehicle (EV) leases, according to reports.
Securitisation, where Tesla bundles leases into batches and sells them off, has been a part of the EV maker's financing since 2014, but this would be the largest yet, said company watchers.
Elon Musk's company is ramping up production in China and elsewhere and analysts suggested this will free up more funds to fund leases from new buyers.
Existing leases will be graded into separate bond categories based on the credit quality of the customers and the highest-rated sold-off.
A similar Tesla bond issue in July paid coupons of 5.6% to 6.4%, with rates and pricing for the latest issue to be revealed next week, said the reports.
The size of the issue highlights that credit quality in the US is still holding up relatively well in spite of the spate of interest rate rises pushed through by the US Federal Reserve.
Most of the pain being felt is in the subprime market, said lenders, and not by owners of Tesla’s expensive EVs.