In 2021, Tesla's R&D spending is up 74% YoY to $1.1 billion. The main costs are associated with personnel costs as the development of new factories and products continues.
In Tesla's 10-K filing with the US Securities and Exchange Commission (SEC), the company said that its R&D expenses consist primarily of personnel costs for manufacturer teams in engineering and research, manufacturing engineering and manufacturing test organizations, prototyping expense, contract and professional services, and depreciated equipment expense.
In 2021, R&D spending increased by $1.10 billion, or 74%, year-over-year. Tesla said the increase is mainly due to a $506 million increase in employee and labor related expenses due to an increase in headcount, a $263 million increase in R&D expensed materials, a $211 million increase in facilities, outside services, freight and depreciation expense, and a $103 million increase in stock-based compensation expense.
These spendings supported an expanding product roadmap, such as new versions of Model S and Model X. In addition, this included the development of new technologies, including Tesla's own battery cells, known as 4680. The company also reported additional R&D spending as it is in the pre-production stages at Gigafactory Texas and Gigafactory Berlin.
However, it should be noted that R&D expenses as a percentage of revenue remained unchanged at 5% compared to the previous year. Thus, R&D expenses increased only in proportion to the increase in total revenue from expanding sales.
© 2022, Eva Fox | Tesmanian. All rights reserved.
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About the Author
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.