A significant milestone has been reached. On Monday morning, Tesla’s market value officially exceeded that of General Motors for the first time, establishing the Silicon Valley electric vehicle manufacturer as the most valuable carmaker in the United States.
At least, this is the situation on paper.
As of 12:15 PM on Monday, Tesla’s stock was priced at $310 per share, reflecting an increase of about 2.5 percent since the trading session began. This raises the company’s total market capitalization to around $51 billion, while GM’s valuation stands just above $50 billion.
Only last week, Tesla surpassed Ford’s market valuation to claim the second position among American automakers. However, it is still significantly behind leading manufacturers; Toyota, holding the top spot, boasts an impressive market value of $172 billion.
Nonetheless, Honda’s market capitalization, which sits at $52 billion, could soon be within reach for Tesla if the stock continues on its upward trajectory in the coming days.
Tesla’s remarkable valuation comes despite the fact that the company produced only 76,000 vehicles last year, compared to GM’s 9.8 million units sold in 2015. Furthermore, Tesla has yet to post a profit. Nevertheless, investors appear to view the electric vehicle manufacturer as a lucrative tech stock rather than a traditional reliable automaker.
“Currently, nothing seems to be hindering Tesla’s growth. They could surpass Honda as well,” analyzed David Whiston of Morningstar Inc. in an interview with Bloomberg. “The market is more focused on the potential future value of Tesla’s other business ventures rather than its current profits and cash flow.”
Additionally, it’s worth noting that Tesla’s $51 billion valuation translates to Elon Musk’s personal net worth of approximately $15.1 billion, according to Forbes‘s real-time billionaire rankings. This positions him among the wealthiest individuals globally.
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