Tesla Becomes Most Valuable American Car Manufacturer

New York City USA Last monday April tenth Tesla’s value soared to an all time high of 50.9 billion american dollars making it the most valuable American car manufacturer and in the number six spot world wide hot on the Heels of Honda. Many of you might know of Tesla from their recent duo of fully electric cars dubbed the Model S and the model X or perhaps you were one of the four hundred thousand plus people to have preordered their latest offering the model III which will complete Tesla’s perfect trifecta of cars. Perhaps you heard of them through their founder Elon Musk who is also known for making spaceships, inventing Paypal and founding a company focused only on creating artificial intelligence. If you have never heard of them, all you need to know is that Tesla’s family sedan completes the 0-100 KM/H sprint in 2.23 seconds, their minivan takes only 2.8 seconds to complete the same task and Tesla’s newest offering should cost less than 30 000 dollars and they all drive themselves.

Sound to good to be true, you might be right as Tesla has never made a profit once in their entire ten year existence. Its 50.9 billion dollar valuation puts it ahead of GM only one week after having surpassed Ford on the stock market and leaving within one billion of honda’s value which would put it in the top five auto manufacturers worldwide. This is despite the fact that Tesla has not once made a profit and is projected to lose approximately 950 million in 2017 alone while brands such as GM are projected to make over 9 billion dollars profit and Ford is only 2.7 billion short with a projected profit of 6.3 billion. Despite Tesla’s horrendous profit margin they are predicted to surpass Honda’s value of 52 billion launching them into the top five auto manufactures globally which currently consist of Honda, BMW, VW, Daimler and Toyota. Tesla does still however have along way to go if they want to surpass Toyota’s value of 174 billion dollars.

Tesla’s evaluation is largely due the fact that currently Tesla is being treated in avery similar way to how gold and most property is treated on the stock market. Most investors are banking on Tesla being able to maintain is position of dominance in the electric car market therefore with the rise in popularity of electric cars Tesla’s value should increase along with that and we could perhaps even see Tesla’s first profit. This is however still a long way away and many things could still change before this occurs. For example just recently Tesla was beaten to market of sub 30 000 dollar electric cars with more than 200 miles (320 km) of range by Gm’s own car the Bolt There has also been increasing pressure from brands such as BMW with the introduction of the I series of cars and even totally new brands such as Faraday Future who are promising a 1050 horsepower, all wheel drive, air suspensioned, self driving minivan esk vehicle meant to challenge Tesla.

Perhaps Tesla’s value sits where it is at 50.9 billion because of the sheer cool factor associated with the brand name Tesla. While brands like Ford and GM make very good cars currently with offerings like the GT350R, Z06 and more practical options such as the Escape and the Equinox many people still remember them for dreadful cars like the Scorpio and the lumina but Tesla has never made a product that received a bad reception. Infact tesla is better known for things like offering free use of Tesla’s supercharger stations to anyone who bought a Tesla. Or maybe they are better known for literally reinventing the door by creating the “Falcon Wing door setup on the model X. Perhaps it's the biohazard filter installed on most Tesla’s allowing medical grade air to filter into the cabin no matter what is going on outside, but no matter what caused its success it is an undeniable fact that Tesla’s stock market value has gone up by over 1000 percent since first arriving on the stock market in 2010.

“Tesla’s products have a captivating impact on consumers and shareholders alike; this advantage will be difficult to replicate,” Potter, the Piper Jaffray analyst, wrote in a report Monday. This quote explains very well why Tesla’s value is as high as it is despite Tesla’s truly horrific financial history which is predicted to continue into the future. Even though Tesla will come under increasing amounts of pressure from competitors such as GM, BMW and Faraday Future if it can continue its momentum Tesla certainly has a chance to continue growing.