Tesla Motors surpasses General Motors and Ford in terms of market capitalization
Tesla Motors reached an all-time high on January 8, 2020, when its market capitalization hit almost $89 billion that was larger than the combined market cap of GM ($50 billion) and Ford ($37 billion). The electric-vehicle startup that suffered a loss of $773 million in 2016 during the initial phase is now sky-high in Silicon Valley. Tesla has shown commendable progress with surprise profit in the third quarter of 2019. The company’s stock doubled after premium car deliveries and smooth operation at the new factory in China.
Tesla’s calibre was often met with distrust by the short sellers and traders against long-running players like Ford and General Motors. However, the investor’s confidence in the CEO Elon Musk and his company has helped them outrun the competitors. Despite the recent success, the analysts and investors remain sceptical about Tesla’s sustainability. David Kudla, the Chief Investment Strategist at MainStay Capital Management, states, “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.”
Tesla’s mainstream rivals are still settling in the new generation market of electric vehicles.
Hence, the jury may be divided on Tesla’s future, but for now, it seems to be competing well with its unique technology, style, and performance.