Abstract This paper presents a new equation for predicting the collapse of tubulars under external pressure. The development of the equation is based on a large number of non-linear finite element simulations of tubulars with different geometrical tolerances and mechanical properties. The simulation results for the collapse pressure and post-collapse geometry of the tubulars were verified with full scale physical tests. A nonlinear regression analysis was then performed on the data obtained from the simulations to optimize the parameters of the collapse equation. The new equation accounts for variations in the tubular diameter, wall thickness, ovality, eccentricity, and material elastic-plastic behavior. This new collapse equation provides significant advantages over existing formulas, mainly because it was developed based on non-linear mechanics solutions of the collapse problem as compared to equations derived from statistical analysis. In addition, the equation gives the true collapse pressure of the tubular, whether the tubular collapses elastically or after it has yielded. The new equation could be used to design tubulars based on manufacturing tolerances with respect to wall thickness, ovality, and eccentricity as well as material mechanical properties. This allows for design optimization which could account for significant cost savings, especially when designing expensive non-API tubulars such as corrosion resistant alloy tubulars. The new collapse equation presented in this paper provides accurate predictions of the collapse pressure of tubulars and accounts for tolerances in the tubular geometry and material elastic-plastic behavior. This new equation is simple and could be used in optimizing tubular design.