(New York) Tesla, boosted on Wall Street by a mega-order of 100,000 electric vehicles from rental company Hertz, entered the very select club of companies worth more than 1000 billion dollars on the stock market on Monday.
Updated Oct 25, 2021
Investors have ignored a new alert issued by the US office responsible for transportation safety, the NTSB, which sharply criticized the group on Monday for ignoring its recommendations on its driver assistance system.
Elon Musk’s group shares soared 12.66%, ending at $1,024.86 on Wall Street, giving it a market capitalization of $1,029 billion.
Only Apple, Microsoft, Google and Amazon are currently more expensive on the New York market. And Tesla is worth 12 times more than the biggest car seller in the United States, General Motors.
This outbreak also consolidates the place of the richest man in the world for Elon Musk, who according to the firm Factset, owns approximately 17% of the shares of the company.
The stock had already climbed after the publication of results last week for the manufacturer, which again experienced record third-quarter sales and profits, despite the problems of supply and shortage of semiconductors which affect the whole of the automotive industry.
It took off again on Monday after the announcement of an order for 100,000 vehicles by the end of 2022 by Hertz. In other good news, the Tesla Model 3 ranked at the top of Europe’s best sellers in September.
For the boss of the car rental company, Mark Fields, the latter “have become consumer products” and this is only the beginning.
Hertz is banking heavily on this new strategy, even hiring American football star Tom Brady to promote it. With Tesla, electric cars should represent more than 20% of its fleet.
“An order of this magnitude […] highlights the progressive adoption of electric vehicles in the United States,” remarks analyst Dan Ives of Wedbush.
The country appears to be catching up with China and Europe, he said.
Even if the traditional manufacturers have recently put the accelerator on the electric, the group of Elon Musk remains for the moment a step ahead.
Not only is the growth of its turnover in a difficult context for the automotive sector “extraordinary”, note analysts at Morgan Stanley. But the company is also one of the most profitable in the industry.
It will soon expand its production capacity by adding two new sites to its plants in Fremont, California and Shanghai, China, in Texas and Berlin.
Tesla will also be able to rely more and more on additional activities, such as its network of charging stations, its car insurance or its autonomous driving software, add analysts from Morgan Stanley.
On this last point, the regulators do not always see the progress of the group with a good eye, like the letter sent Monday by the NTSB to Elon Musk.
The agency, which says it is “very worried”, criticizes him for never having explained how he intended to implement the recommendations issued after an accident in 2016 even though he is currently experimenting with new functionalities in real conditions.
In addition to the Autopilot system already offered on its cars, Tesla has been testing since the beginning of October a new version of its driver assistance system, dubbed Full Self Driving Beta (or FSD Beta), with a group of drivers selected by him, without having first referred to the competent authorities.
This test had another hitch this weekend, as Tesla temporarily pulled a new version of FSD Beta shortly after launch for unspecified “issues”.
“You stated that ‘safety always comes first in the design of a Tesla,'” the letter underlines.
“This statement is completely undermined by the announcement that Tesla drivers can request to use FSD Beta both on highways and in urban settings when you haven’t remedied design flaws.” several accidents, it is added.
In particular, the NTSB recommended that Tesla and five other automakers incorporate tools into their driver assistance systems that limit their use to the conditions for which they are intended.
She also recommended developing applications to determine when the driver is no longer attentive enough.
Only Tesla never responded, regrets the NTSB.