Tokyo — The surge in Tesla’s shares so far in June moved Elon Musk’s company even closer to displacing Toyota as the world’s most valuable carmaker.
With a market capitalisation of more than $190bn, Tesla still has some distance to close to reach Toyota’s $212bn valuation, which includes treasury shares, according to data compiled by Bloomberg. A rally of about another 14% in Tesla shares could see it claim the crown if Toyota holds steady, with Tesla already up 23% since the beginning of June.
Tesla’s valuation comes despite a gulf in the scale of the two automakers. The Palo Alto, California-based maker of electric cars produced 103,000 vehicles in the first quarter, or about 4% of the almost 2.4-million made by Toyota.
Tesla climbed another 9% on Wednesday to close above $1,000 for the first time as CEO Musk told employees it was “time to go all out” and put its Semi truck into volume production. Wedbush Securities touted the “massive” opportunity for the company in China, with Tesla appearing to be on track to reach 100,000 deliveries from its Shanghai factory in the first year.
Tesla became the world’s second-most valuable automaker in January, when it surpassed Volkswagen. It’s now worth more than twice the German rival, which said on Wednesday it will meet an end-of-summer deadline to start delivering its flagship ID.3 electric car.
Tesla’s recent rally has also been boosted by hype surrounding newly listed Nikola, a battery-electric and hydrogen fuel-cell truck maker.
Toyota, meanwhile, forecasts an 80% plunge in profit in 2020 and expects it could take until the first half of 2021 before the auto market recovers to pre-pandemic levels. Shares in Toyota are down about 10% so far in 2020, trading about 17% lower than the record high hit in 2015. Toyota’s market valuation includes the 14.3% of shares Toyota itself holds as treasury stock, worth around $30bn.
Despite pioneering interest in fuel-efficient vehicles with the Prius hybrid, Toyota was late to shift to electric vehicles, betting first on hydrogen fuel cells. The company is now changing course with a series of high-profile investments in electric vehicles, self-driving cars and futuristic cities.
“My true mission is to completely redesign Toyota into a mobility company,” Akio Toyoda, CEO and grandson of the automaker’s founder, said in 2019.
Tesla has 10 buy-equivalent ratings, while 12 analysts recommend holding the shares and 15 advising clients to sell, while Toyota has 13 buy ratings, eight holds and one sell, according to data compiled by Bloomberg.
Bloomberg
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