This shouldn’t be in ‘politics’ but what the heck…
[SIZE=6]Tesla Passes BMW by Value to Become Fourth-Biggest Automaker[/SIZE]
[ATTACH=full]104638[/ATTACH]
(Bloomberg) – BMW AG makes ultimate driving machines, but Tesla Inc.’s stock is the one that’s motoring.
A week-long rally in Tesla shares, spurred by Chief Executive Officer Elon Musk’s confidence in selling electric vehicles at scale, vaulted the company’s market capitalization past the German luxury carmaker in early Friday trading. The amount of ground Tesla covered was vast: BMW was valued at a $30 billion premium as of early December.
The change in rank is no small matter. Luxury carmakers like BMW trade at a higher value than the likes of General Motors Co. or Ford Motor Co., which Tesla passed back in April. BMW has a powerful brand among car buffs and affluent consumers and its vehicles command premium prices and fatter margins. In bidding its market cap past BMW, Tesla investors are signaling confidence the company can go up against a formidable player that also sells electric cars – and prevail.
“The argument is that Tesla has the ability to do things that the others can’t and that, being all-in on electric cars, they will win,” said Kevin Tynan, an auto analyst with Bloomberg Intelligence. “It’s a flawed argument. You can’t tell me that BMW can’t do what Tesla can do.”
…
A week-long rally in Tesla shares, spurred by Chief Executive Officer Elon Musk’s confidence in selling electric vehicles at scale, vaulted the company’s market capitalization past the German luxury carmaker in early Friday trading. The amount of ground Tesla covered was vast: BMW was valued at a $30-billion (U.S.) premium as of early December.
The change in rank is no small matter. Luxury carmakers like BMW trade at a higher value than the likes of General Motors Co. or Ford Motor Co., which Tesla passed back in April. BMW has a powerful brand among car buffs and affluent consumers and its vehicles command premium prices and fatter margins. In bidding its market cap past BMW, Tesla investors are signaling confidence the company can go up against a formidable player that also sells electric cars – and prevail.
“The argument is that Tesla has the ability to do things that the others can’t and that, being all-in on electric cars, they will win,” said Kevin Tynan, an auto analyst with Bloomberg Intelligence. “It’s a flawed argument. You can’t tell me that BMW can’t do what Tesla can do.”
After climbing as much as 1.9 per cent and surpassing BMW’s $61.3-billion market value, Tesla shares reversed gains after Hedgeye Risk Management added shorting Tesla to its best ideas list. The stock dropped 1.8 per cent to $363.41 as of 12:55 p.m. in New York, dropping its market cap about $1.7-billion below BMW’s.
Mr. Musk, 45, engendered optimism this week by telling shareholders Tuesday his most affordable electric car thus far, the Model 3, will start production as scheduled in July. Within two to three years, Musk sees following that sedan up with a cheaper crossover model, the Model Y, that eventually will draw more demand and need its own assembly plant.