- The 100,000 EV order from Hertz skyrocketed Tesla right into the Trillion dollar club
- On Monday, Tesla’s market cap stood at over $1.02 trillion
- Tesla’s promise of EVs as the future of automotive industry brought itself the biggest deal ever from Hertz
Tesla’s record run in the stock market on Monday made it the first-ever car manufacturer to join the elite group of trillion-dollar companies like Apple Inc, Amazon.com Inc, Microsoft Corp and Alphabet Inc.
On Monday, the stock of Tesla had surged 12.66 per cent to end at $1,024.86 apiece on the NASDAQ index after it landed with its order from rental car company Hertz.
Tesla founder and CEO Elon Musk’s net worth also blew up from $36.2 billion to $289 billion, placing him ahead of the other billionaires including, Amazon Inc’s founder Jeff Bezos, according to Bloomberg Billionaires Index.
“With the $1 Trillion valuations, Tesla is now more valuable than the other 9 biggest listed carmakers combined. While they have a way to go to justify such a high valuation, they have done well to turn cash flow positive over the last few quarters and reduce reliance on sales of emissions credits to boost the bottom line,” said Asheesh Chanda, Founder and CEO, Kristal AI.
Tesla shares are now more than 40% in stock value since January of this year. Tesla has also survived better during the current semiconductor shortage situation than its contemporaries.
Tesla delivered 240,000 vehicles in the third quarter, 70% more than the three-month period last year, due to it primarily ramping up Model Y production in its Shanghai factory. Tesla’s factories are still not running at full capacity, CFO Zach Kirkhorn said on the company’s earnings call last week.
Currently, market analysts are backing Tesla’s continuous rise in price. Whether or not Tesla will maintain this sudden rise in its worth remains to be seen.
Tensions between the electric-car maker and the National Highway Traffic Safety Administration increased in recent weeks the company is being questioned for not issuing a recall. This comes after a dozen of its customers’ cars operating on autopilot collided with parked first-responder vehicles. In answer to this issue, Tesla merely updated its autopilot software.
Equally important to note is Tesla’s rising competition in the EV market. In recent times, a number of major companies have announced their transition to the electric vehicle market with promising future plans.