American automotive company Tesla today became the most valuable car firm in the history of the US as hit the $470 (₹33,864) threshold for the first time. This is an impressive achievement considering the controversies the frim has been embroiled in.
A few months ago, Tesla’s shares were about $254 (₹18,301). Its shares took a jump of 85% within a few weeks. Its market capitalization is about $84.3 billion, more than what Ford’s was in its days. The firm is shy of just $2 billion to reach Ford and GM’s market cap, combined.
Various factors are responsible for the peak in Tesla’s shares. The first factor is the Cybertruck that raised a lot of eyebrows and shares due to its unique design. The second is the record Tesla set for deliveries in 2019. It delivered 367,500 vehicles during 2019, which was up from 182,400 vehicles delivered in 2018. The third factor concerns Tesla’s business prospects in China. CEO Elon Musk was in China recently at his Shanghai factory where he said that Tesla’s goal is to produce a total of 500,000 cars per year, just in Shanghai. He added that “It will serve as a template for future growth.”
But this crown comes with its own caveats. Firstly, Tesla is yet to turn its annual profit. Secondly, its fortunes depend on how it performs in abroad, especially in China. Lastly, Tesla’s shares are turbulent. It lost half its value between December 13, 2018, and June 3, 2019. But it has been doubled as of now. Another thing to note is that Toyota Motor Corp. and Volkswagen AG have relatively more market value than that of Tesla’s – $231.76 billion and $98.05 billion, respectively.