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How Elon Musk’s Tesla became a trillion dollar company overnight




Electric car manufacturer, Tesla’s market valuation has hit and surpassed the $1 trillion mark Monday, a milestone reached by the company 11 years after it became a publicly-traded company.


It also puts Tesla in select companies with Apple, Amazon, Facebook and Google, all of which have market caps above $1 trillion.

Tesla met the $1 trillion market cap mark around midday Monday when shares hit $998.22. Share prices hovered just below $1,000 and then suddenly shot past it — another first for Tesla. Shares closed up 12.66%, at $1,024.86. This is the first time the company’s share price reached $1,000 a share.

The rally in the price of Tesla could be traced to a deal concluded by the automaker, landing its biggest-ever order from rental car company Hertz, a deal that reinforces the vision of Tesla, which is to top the entire auto industry in sales over the next decade.

Most automakers do not boast about sales to rental car companies, as it is perceived as a deal, which is often made at discounts, to unload slow-selling models. For Tesla however and its investors, Hertz’s decision to order 100,000 Tesla vehicles by the end of 2022 is an indication that electric vehicles are no longer a niche product but will dominate the mass car market in the near future.

Elon Musk’s Tesla
Elon Musk had earlier set an annual sales growth target of 50%, on average, eventually reaching 20 million vehicles a year. That would be more than double the volume of current sales leaders, Volkswagen AG and Toyota Motor Corp.

Tesla also appears to be making progress resolving regulatory problems that threatened its business in China. The company said it had opened a new data and research center in Shanghai to comply with government requirements that data collected from vehicles in China stay in the country.

Tesla is also facing new U.S. regulatory pressure. The National Transportation Safety Board’s new chief sent Musk a letter questioning why Tesla was rolling out its “Full Self Driving” software even though the company has not officially responded to the NTSB’s questions about the automated driving system’s safety.

Consulting firm JATO Dynamics reported today that the consumer demand for electric vehicles is turning a corner in some major markets. The Tesla Model 3 was the best-selling vehicle of any kind in Europe last month.

Tesla now faces the daunting day-to-day challenge of becoming a high-volume automaker growing at a rate not seen since the early 1900s when demand exploded for Henry Ford’s Model T. The automaker is trying to cope with an order backlog for its vehicles and extended supply chain disruptions.

Elon Musk’s Tesla 1

Tesla’s cheapest Model 3 sedan starts at about $44,000, making this order worth about $4.4 billion, if the entire order were for its mass-market sedan. With the current order, Hertz said EVs will make up more than 20% of its global fleet.

Tesla shares surged over 9.5% to top $995.75, making the company worth $1 trillion as of the time of this report. It currently trades $994.40, up 9.31% as of the time of this report. Morgan Stanley has increased Tesla’s share price projection to $1,200 per share.

Elon Musk, the founder, the founder of Tesla is also Chief Engineer at SpaceX; early stage investor, CEO, and Product Architect of Tesla, Inc. Must is also the founder of The Boring Company; and co-founder of Neuralink and OpenAI. A centibillionaire, Musk is the richest person in the world as of September 2021.

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