Published: Thu, January 23, 2020
Markets | By Otis Pena

Tesla becomes first American automaker worth $100 billion

Tesla becomes first American automaker worth $100 billion

The electric-car maker's shares soared as much as 5.9% in early trading Wednesday, extending a 31% surge already this year.

Wednesday's closing valuation of $102.7 billion makes Tesla the second most valuable automaker by market cap, bested only by Toyota.

For achieving the first milestone, Musk will get shares worth $346 million if Tesla shares hold above $100 billion over six months, based on the formula.

Tesla's share price has more than doubled since October, when the firm reported a rare quarterly profit.

Musk in August 2018 tweeted that he had "funding secured" to take the company private when its shares were trading in the mid-$330s, only to later give up under investor pressure and regulatory concerns. By comparison, General Motors is now worth $50 billion and Ford $36.6 billion.

Musk agreed to the plan, which would pay him nothing until Tesla's value reached $100 billion.

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Tesla CEO Elon Musk put a question to his 30 million Twitter followers, asking whether they would be interested in playing "The Witcher game" on the dashboard screen in their Tesla vehicle, most likely referring to The Witcher 3. Tesla's board signed off on the compensation package in March 2018, when Tesla was worth $52.46 billion.

After saying three months ago that Tesla was no niche manufacturer anymore, he told top Volkswagen executives at an internal meeting in Germany last week that connected vehicles will nearly double the time consumers spend online, and that cars will "become the most important mobile device".

The company logo is pictured on a Tesla Model X electric auto in Berlin on November 13, 2019.

Analyst Dan Ives of Wedbush Securities offered an upbeat view of Tesla in a research note Wednesday.

"He's one of our great geniuses, and we have to protect our genius".

During an January 22 interview to CNBC in Davos, Switzerland, Trump said, "You know, we have to protect Edison and we have to protect all of these people that came up originally with the light bulb, wheel and all of these things. And he's one of our very smart people".

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