Tesla from Elon Musk overtakes Toyota and becomes the world’s most valuable automobile manufacturer
Tesla Inc overshadowed Toyota to become the world’s most valuable automaker on Wednesday as its stock value hit a record high.
Shares of the Elon Musk company rose five percent in early morning trading to a record $ 1,133, raising the company’s market cap to $ 209.47 billion – $ 6 billion more than Toyota.
The rapid rise in shares, which has more than doubled in value since early 2020, underscores growing investor confidence about the future of electric vehicles and marks Tesla’s shift from a niche car manufacturer to a world leader in eco-friendly cars.
Tesla became the world’s second most valuable automaker in January, when it surpassed Volkswagen AG. As of Wednesday, the company is now worth more than twice the German manufacturer.
Tesla Inc overshadowed Toyota to become the world’s most valuable automaker on Wednesday as share value hit a record high
Shares of the Elon Musk-owned company rose by a record $ 1,133 to a record $ 1,133 in early morning trading, increasing the company’s market capitalization to $ 209.47 billion – $ 6 billion more than Toyota
In the ten years since he made the company public, CEO Musk has regularly strayed from the industry’s standards and has broken many of his rules by selling cars online and assembling vehicles at high cost in California.
After several years of losses, Tesla has delivered three profitable quarters since the third quarter of 2019 and has surprised investors despite solid coronavirus outbreak in 2020 with solid deliveries in the first quarter.
While the company’s value continues to rise, there still remains a significant gap between the magnitude of Tesla’s actual car production compared to the world’s largest car manufacturers.
For example, during the 2019 fiscal year ending March 31, 2020, Toyota sold 10.46 million vehicles. It reported net sales of $ 281.20 billion during that period.
Tesla closed 2019 with sales of $ 24.6 billion, after delivering only 367,200 vehicles.
In addition, when looking at the business value of any business, including debt, Toyota exceeds Tesla’s $ 290 billion worth of $ 252 billion, according to FactSet data.
Musk said in the past that Tesla would deliver at least 500,000 vehicles in 2020, a forecast the company has not changed despite the coronavirus pandemic.
Tesla is expected to report delivery figures for the second quarter this week.
Toyota, one of the world’s most profitable automakers, sold 10.46 million vehicles during fiscal 2019 ending March 31, 2020. At the time, it reported net sales of 30.226 billion yen, or approximately $ 281.20 billion. .
Tesla closed 2019 with revenue of $ 24.6 billion, after delivering only 367,200 vehicles last year
But while the company’s horizon looks bright, Musk’s future behind Tesla’s wheel has been called into question after investors were urged to fire him as CEO over a controversial bonus deal that would set him a record $ 55.8 billion deliver.
Pirc, an influential shareholder advisor, Tuesday advised investors to vote against Tesla’s reward deal because it “ wrongfully enriches the CEO. ”
Advisers said the deal had exposed the company to a lawsuit, claiming that, “The board, including CEO Elon Musk, has awarded himself excessive compensation packages for three years, allegedly allowing directors to” enrich themselves at the expense of the company. ” ‘
Pirc then called on investors to vote against the re-election of Musk on the board in light of the remuneration agreement, warning that he “poses a serious risk of reputational damage to the company and its shareholders.”
They claimed that Musk’s frequent controversial outbursts in interviews and online Tesla have cost millions in settlements, exposing “an unnecessary reputation risk to the company.”
Last year, Musk was subject to a $ 190 million defamation lawsuit for derogatory remarks I made about British diver Vernon Unsworth, who helped save thirteen children trapped in a Thai cave.
Musk was found not to have reached the legal defamation and was not held liable for any damage.
The year before, the US Securities Exchange (SEC) regulator fined Musk and Tesla $ 20 million for his tweets, detailing detailed plans to take the company private at a significant premium to its stock price, making the shares rose.
As part of the settlement, Musk was forced to relinquish his position as Tesla’s chairman.
In the 10 years since he made the company public, CEO Musk has regularly ignored or violated many of the industry’s standards and regulations, sold cars online, and assembled vehicles at high cost in California (Fremont, CA, factory show above)
While the company’s future looks bright in the stock market, Musk’s future as the company’s CEO has been called into question after investors were urged to remove him from the board due to a bonus deal giving him a record 55.8 billion dollars.
Actually, Musk knew that the potential transaction was uncertain and subject to numerous unforeseen circumstances. Musk had not discussed specific deal terms, including price, with potential financing partners, and his statements regarding the potential transaction were in fact missing, “the SEC said in its ruling.
Pirc said the incident “gave rise to allegations of stock market abuse, with the SEC alleging that Musk had lied to investors. Musk and Tesla settled these claims with the SEC, paid $ 40 million, causing financial damage. ‘
Musk’s tweets about his opposition to coronavirus locking measures also raised Pirc concerns, the company said.
“Musk was an outspoken opponent of the Covid-19 quarantine and reportedly demanded that workers return to work during quarantine, without adequate precautions / protection and despite workers’ protests,” said Pirc. “This concern is heightened as multiple Tesla employees have also been reported to have tested positive for Covid-19 since returning to work.”
Investors were also encouraged to oppose the re-election of Tesla’s chairman, Robyn Denholm, who managed to convince Must when he had to step down in November 2018.
Pirc said she had to leave her position because of the role she played in overseeing Musk’s pay.
Tesla’s annual general meeting was scheduled to take place on July 7, but Sunday the company revealed in a statement that it has now postponed voting until September.