Tesla's stock market value zooms past General Motors’ and Ford’s combined market caps for first time
- The Silicon Valley electric car maker’s stock jumped nearly 5 per cent on Wednesday, closing at a record US$492.14 per share
- Its market capitalisation is now almost US$89 billion, US$2 billion more than the sum of General Motors’ and Ford’s market caps
For the first time, Tesla’s stock market value has eclipsed the combined values of General Motors and Ford Motor.
The Silicon Valley electric car maker’s stock jumped nearly 5 per cent on Wednesday, closing at a record US$492.14 per share and elevating its market capitalisation to almost US$89 billion, or US$2 billion larger than the sum of General Motors’ and Ford’s respective market caps of US$50 billion and US$37 billion.
“It’s clear that Tesla is back to being a story stock and there’s a lot of good news out there,” said David Kudla, chief investment strategist at MainStay Capital Management. “But there are still some problematic issues out there, chief among them is what will its sustained profitability look like, and when will it start to be valued like a car company and not a tech company.”
The progress made by Tesla chief executive Elon Musk has defied short sellers and other traders expecting the carmaker to be overtaken by long-established car companies, including GM and Ford.
Underscoring investors’ confidence in Musk and his company’s future growth, its market capitalisation has outpaced its US rivals, even as their businesses dwarf Tesla’s. GM and Ford each delivered more than 2 million vehicles in the United States last year, compared with Tesla’s worldwide deliveries of 367,500 vehicles.