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On Monday, Tesla’s market value surpassed $1 trillion following news that Hertz plans to add 100,000 electric vehicles to its fleet by the end of 2022.
Approximately one fifth of Hertz’s fleet will be Model 3s, which will cost $4.2 billion over the next 14 months. The company plans to install charging stations as well.
Tesla vehicles can travel about 200 miles per charge, but there are few charging stations in the US, something the Biden administration is hoping to change.
Mark Fields, interim boss of Hertz, said electric vehicles have now become mainstream, and global demand and interest have only just begun.
The company joins Apple, Amazon, and Microsoft, all of which have a trillion-dollar market valuation
One trading day after breaking $900, Tesla stock soared to more than $1,045 during midday trading, a new record high. At about $1,024 a share, the stock closed up 12.66%.
Tesla has become the second-fastest company to reach the $1 trillion mark, reaching it just more than 12 years after its IPO in 2010. In just over 9 years, only Facebook reached $1 trillion from its Initial Public Offer.
Tesla, by contrast, has seen its market value surpass the combined market values of the 11 largest global automakers as Wall Street gets enthused about the future of electric vehicles.
The value of Tesla exceeds that of Toyota (TM), the second most valuable automaker, which has a market cap of about $280 billion, but whose sales and profits are much lower than those of Tesla.
With only 500,000 cars sold last year, Tesla’s market value is roughly $2 million per vehicle sold.
So far this year, the company has sold 627,000 cars and aims to reach a million in sales this year.
Although investors believe Tesla will achieve 50% or more in annual sales growth over the next few years, that still translates to a valuation greater than $1 million per vehicle.
This article was originally posted on FX Empire