Android has overtaken Windows as the most used OS. Renewable energy is outpacing fossil fuel growth around the globe. And for the first time an electric car company has beaten out its legacy rivals on the stock market.
As the markets closed on Monday, Tesla’s market cap stood at $48.7 billion — $3.1 more than Ford and only $2.5 billion below GM’s market value. By Tuesday, Tesla had crested a value of $52.7 billion, beating out GM to become the most valuable car company on the market.
The upswing in stock price was helped by Sunday’s quarterly report from Tesla which indicated the company’s increase in sales from just a year ago. 25,000 electric cars were delivered — that’s a 69 percent boost from the first quarter of 2016. As the company looks ahead to the release of the Model 3, reports like this one will do a lot to encourage investors to believe in Tesla’s abilities to deliver on big promises.
Elon Musk celebrated the strong showing of his company with an opaque dig against financial cynics:
Stormy weather in Shortville …
— Elon Musk (@elonmusk) April 3, 2017
As in, anyone who’s betting on the financial downfall of my electric wonderland is in for a big upset.
Of course, the market is always changing, and this is just the latest turning of the wheel. But it’s a big first for Tesla.
The company has made bold moves in the last year. From the merging with SolarCity to the creation of its massive Gigafactory, there has been plenty of room for disaster. And with Tesla’s biggest venture yet — the mass market Model 3 sedan — still awaiting its debut on the production line, there remains plenty of risk for the upstart automaker. But the New York Times argues that the drastic landscape that Tesla occupies is exactly what has drawn investors to bet on the company’s future:
While G.M. and Ford may have strong profits and healthy balance sheets, Tesla offers something Wall Street loves much more: the potential for dramatic growth.
“Investors want something that is going to go up in orders of magnitude in six months to six years, and Tesla is that story,” said Karl Brauer, a senior editor at Kelley Blue Book. “Nobody thinks Ford or G.M. is going to do that.”
Everything about Tesla screams modernity and the technological future. Its electric vehicles already have one and a half feet in the self-driving revolution, while other legacy car companies (though they are of course selling more units to customers) are struggling to keep up with the changing focus within automotive tech.
Numbers later this year surrounding the release of the Chevy Bolt will finally give the Big Three an indicator of how they could look to compete against the electric vehicle competition. However, as Wired notes, GM still sees the Bolt as a ‘halo car’ — a token sign that the company can innovate, rather than a large-scale plan for the future of their business. Meanwhile, Tesla’s diminutive but feisty market share is all about innovation, with investors setting their sights on the promise built within the far-reaching tech at the heart of Tesla’s goals for the future.
What goes up must come down, and Tesla has a lot of pressure mounting over the release of the Model 3, but for now, Elon Musk has a lot to celebrate.