Tesla is now in the race to become a trillion-dollar company. And Tesla market value surpasses $1 trillion on Monday. Tesla now reaches the $1 trillion market capitalization mark, as the stock price soared 12.66% on the back of a massive order from car-rental behemoth Hertz. With its share price rising to over $1,000 per share for the first time ever.
Tesla market value surpasses $1 trillion
The company hit the $1 trillion value mark on Monday (the mid-day). It is the first time that Tesla market value surpassed the said market value after becoming a publicly-traded company almost 11 years ago. Tesla’s market capitalization on the NASDAQ index stood at the $1.02 trillion mark on closing with the stock price reaching an all-time high of $1,024.86 per share.
The share prices jumped by 12.6% following the announcement of Tesla’s recent deal with the car rental giant Hertz. For Tesla and its investors, Hertz’s decision to order 100,000 Tesla Model 3 vehicles by the end of 2022 showed electric vehicles are no longer a niche product but will dominate the mass car market in the near future.
The deal aims to push Hertz’s EV offerings up to 20% and the company reportedly paid around $4.2 billion for it. Also, with this deal, Tesla Model 3 becomes the first EV to top European monthly sales (Full Story). Now Tesla is aiming to deliver the order to Hertz by next month and the latter will have 100,000 Tesla Model 3 cars in its inventory by the end of November. The EV maker delivered 499,550 vehicles in 2020, with the vast majority of these being its most popular Model 3 sedan.
Tesla market value vs Others
Tesla is the most highly valued of any of the world’s auto manufacturers and is knocking on the door of an elite club that includes Apple Inc AAPL.O, Amazon.com Inc AMZN.O, Microsoft Corp MSFT.O, and Alphabet Inc GOOGL.O
Also, Tesla’s market cap is now more than the top 5 BSE companies combined. The other BSE companies whose market cap has been eclipsed by Tesla include Tata Consultancy Services with a market cap of 12.91 lakh crore, HDFC Bank at Rs 9.17 lakh crore, Infosys at Rs 7.24 lakh crore, and ICICI Bank with a market capitalization of Rs 5.8 lakh crore.
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Elon Musk’s position as the richest person
With Tesla market value of 12.66% gain on Monday, the EV maker’s market cap ended the day with a valuation of $1.02 trillion. This translated to a $36.2 billion gain in Elon Musk’s net worth, which propelled his total net worth to a whopping $288.6 billion.
This latest update made 2021 a very good year for the Tesla CEO so far, as his net worth has increased by $119 billion year-to-date. Meanwhile, Jeff Bezos’ net worth stands at $193 billion, after losing $751 million on Monday.
Even Tesla Chief Executive Elon Musk expressed surprise at the velocity of the surge. “Strange that moved valuation, as Tesla is very much a production ramp problem, not a demand problem,” – Elon Musk tweeted in reply to a comment by Ross Gerber, co-founder of the investment fund Gerber Kawasaki and a Tesla shareholder.
Tesla was able to garner a record income of $1.62 billion in the third quarter of 2021, which is a huge increase from its $331 million profit during the same quarter of last year. So, combining this increase in profit and the rising share prices, Tesla market value was able to reach the $1 trillion market value mark for the first time in its history.