The 13-year-old electric company, Tesla from California, pushed 108-year-old General Motors and became the most valuable U.S. auto company.
Tesla’s accomplishment proved that it had the backing of investors and can continue to threaten industry stalwarts GM and Ford. In terms of market capitalization, the company has already surpassed Ford and in no matter of time, it could dethrone its next big American rival.
Shares of Tesla raised by 3% to $313.73 on Monday and it was an upgrade from Piper Jaffray analyst Alexander Potter, who raised his price target by 65% increase. According to the facts, the market value of Tesla reached $51.05 billion that day, a hair above GM’s $50.96 billion market value.
Stephanie Brinley, a senior auto analyst at IHS Automotive, said “Tesla still needs to finds its way. It’s a growing company and needs to scale up quality. We’ll see how Tesla is impacted if incentives [for electric cars] go away. Tesla has pushed the conversation on electric and luxury cars … but only in certain pockets [of the country] do you see a lot of Teslas.”
In competition with thousands of GM dealerships, Tesla has only 50 stores in U.S. GM and Ford, both have been slighted by investors even after spending much on research and development. While Tesla is up by 35%, shares of Ford are down by more than 15% and GM has fallen nearly by 10%.