American company Telsa has become the most valuable car company in the world after its shares hit $1,000 for the very first time. The company has surpassed Japanese Toyota in the race. This comes after the company reported several positive indicators, including ‘million-mile’ battery achievement in recent past. The company’s shares hitting the mark of $1,000 represent a huge 360% gain in the last 12 months. Meanwhile, Tesla sales in China have also seen a massive jump with a 150% on month rise in May 2020.
Musk Factor:
Another reason for this jump is Chief Executive Alon Musk’s announcement that it is time to bring Tesla semi-commercial trucks to “volume production.” However, Musk did not give a set timeline for ramping up the production of this truck.
Musk’s decision to open factories despite the COVID-19 pandemic is another reason behind the company’s recent success. Although six of Tesla’s employees have contracted the virus, this decision has left a very positive impact on company’s shares. The CEO criticized the US-government’s decision of shutdown, calling it fascist and unconstitutional. The company even sued Alameda County for closing one of its factories forcefully in the area. However, it dropped the lawsuit after local officials allowed opening of the facility.
It is pertinent to note that it is hard to compare Tesla with other automobile companies because Tesla is more than an automaker due to its tech-like business approach to automotive business and its growing energy division. However, its most revenue comes from car sales, which primarily makes it an “automaker” on a market capitalization standpoint.
The company saw a similar surge in 2018, making it more valuable than several other automakers in the world. But the rush was short-lived after a problematic stock market year for the electric automaker. However, since then, Tesla shares on another successful run leading to this recent global success.
