Tesla Just Became The World’s Most Valuable Automaker

18 June 2020
Cars, Automotive, Tesla, Elon Musk, Toyota, Volkswagen, Honda, Daimler, BMW, Ferrari, GM, Ford
Despite persistent production issues and Covid's effect on the wider industry, Elon Musk's most famous brand has jumped 375% in value in the last year

Elon Musk is a man of many undertakings and hobbies. Though we may still be waiting on his next rap song or the electric leaf blower he once promised, you can imagine that wherever he is in the world, he’s celebrating. The numbers trickled in slowly – as figures that follow dollar signs tend to do – but at the end of the trading day the fact was clear: Tesla is now not just the most valuable automaker in the U.S, but the electric carmaker has now Toyota to become the single most valuable car company in the world.

As Reuters reported. back in January “Tesla’s stock has more than doubled in value in the last three months, with its market capitalisation piercing $US100 billion on Wednesday, a first for a listed U.S. automaker.” Tesla's growth has only continued since then, with the company's total valuation growth capping out at a monstrous 375% in the last year alone.

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It’s surprising, given the tumultuous history of Tesla’s stocks, which seem to be in a constant state of flux depending on Musk’s actions. In 2018, they feel an estimated 6 per cent after the CEO smoked a blunt with Joe Rogan. And just last year, there was the infamous Cybertruck debacle where, during the vehicle’s unveiling, Musk proceeded to do a live demonstration of the car’s shatterproof windows. And, as windows are prone to do, they shattered. In front of hundreds and an even bigger audience watching the live-stream, causing Tesla’s shares to fall as much as 4.1 per cent following the event.

But as all life is merely a case of resilience and bouncing back, so too did Tesla’s stock. Reuters reveals that the company has leapfrogged more established global rivals, including the likes of Honda, BMW, General Motors, and Daimler. And now, the car company has eclipsed Toyota's current market cap on the Japanese stock exchange, which itself has fallen sharply due to the massive impact Covid-19 has had on car sales across the world. 

The jump in value for Tesla is believed to be the result of recent profit-recording quarters, along with progress at a new factory in China and car deliverers in the fourth quarter that exceeded expectation. Even so, many have been quick to point out that although Tesla is now worth more in terms of overall market cap than Toyota, this doesn't count for the $30 billion in treasury shares that Toyota as a company owns in its own stock. Tesla, for comparison, has none.

It also doesn't really take into account the fact that Toyota's sales, size and market share still dwarf that of the U.S. company. As Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities Co. in Tokyo, told Bloomberg: “There isn’t a single person who thinks that simply because Tesla’s market cap has come close to that of Toyota, that Tesla is a company that is on par with Toyota."

But while many continue to remain suspicious of Tesla, adamant that the company won’t be able to sustain or consistently deliver profit, cash flow and growth, this new accolade only goes to boost confidence in the company. Investors now appear to be looking at the electric vehicles in Tesla’s arsenal as the future of transport.

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With Tesla now sitting at the top of the tree, here are the eight most valuable carmakers in the world, and where they sit on the extended podium.

All market caps in USD as of June 15, 2020.

1. Tesla, $183 billion

2. Toyota, $176 billion

3. VW, $84 billion

4. Honda, $45 billion

5. Daimler, $44 billion

6. BMW, $42 billion

7. Ferrari, $42 billion

8. GM, $40 billion

9. Ford, $26 billion

Via GQ Australia