Published: Sat, January 11, 2020
Economy | By

Tesla's Market Value Is Now Higher Than GM And Ford Combined

Tesla's Market Value Is Now Higher Than GM And Ford Combined

Underscoring investors' confidence in Musk and his company's future growth, its market capitalization has outpaced its USA rivals, even as their businesses dwarf Tesla's.

By reducing prices, Tesla is looking to gain a competitive edge over Chinese startups like Nio and Xpeng.

The price tags for the China-made Model Y will be between 444,000 yuan and 535,000 yuan, Tesla said Tuesday.

Musk also importantly revealed that Tesla will build a China design centre that will design original models for the world.

Tesla delivered China-made Model 3 cars to 10 customers from the public on Tuesday.

Construction of Tesla's first plant outside the United States began in January 2019 and production started in October. Given Tesla has yet to finish Gigafactory 3 and has to start production of Gigafactory 4 and Model Y (and presumably the Semi) as well, I have to wonder how much resources Tesla has to commit to yet another vehicle. After consistently falling well short of the CEO's ambitious targets, the company burned through billions of dollars and came within weeks of running out of money. Eleven analysts recommend buying Tesla shares, while 13 recommend selling and another nine are neutral, according to Refinitiv data. The Model Y is the next technologically brilliant, useful vehicle that Tesla is putting into production for the masses to adopt, something in between the Tesla Model X and Tesla Model 3.

He spent New Year's Eve at the company's car-assembly plant in Fremont, California, closing out a quarter in which Tesla delivered a record 112,000 cars.

Musk's charm offensive in China has appeared to pay off. Originally just a muddy plot about a 90-minute drive away from Shanghai's city center, the China plant has quickly come online since it broke ground at the start of 2019.

Preferential policies and lower supply costs pushed up Tesla's profit margin in China.

But I'm hoping something wonderful comes out of this uncomfortable moment in automotive pop culture - an Elon Musk dance challenge.

About 30 per cent of the parts now used by the Shanghai facility are sourced locally, and the company plans to increase that to 100 per cent by the end of 2020, said Song, the manufacturing director, on December 30. The price tag of the Shanghai-made sedans, however, starts at 299,050 yuan after subsidies.

"Tesla's China production will have a "catfish effect" in the country's auto industry, pushing domestic carmakers to speed up technological upgrading", said Cui Dongshu, secretary-general of the China Passenger Car Association.

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