Tesla sidetracks General Motors to become the most valued automobile company in the U.S., huge profits in store for the automotive giant
Category: #world  By Shikha Sinha  Date: 2017-04-18
  • share
  • Twitter
  • Facebook
  • LinkedIn

Tesla sidetracks General Motors to become the most valued automobile company in the U.S., huge profits in store for the automotive giant

Electric car maker Tesla has become America’s most valuable company by overtaking General Motors this week. Tesla is now the biggest US automaker by market capitalization. This landmark achievement has successfully captured the excitement of potential investors in the city of Detroit.

This accomplishment comes a week after Tesla set a record in achieving huge vehicle sales, and is now racing ahead of Ford in market value. Tesla shares rose by 3.26% to a record high of USD 312 value. The market capitalization of Tesla was seen above USD 51.54 billion, which is estimated to be more than 1 billion above General Motors’ USD 50.22 billion, a 108-year old company.

At present, Tesla is a 13-year-old company, accumulating 0.2% of the U.S. market in automobiles, while GM controls over 17.3% of the market. This provides a clear insight that Tesla is a way smaller company in terms of market share. GM and Ford surged up to sales in millions, while Tesla only somehow managed to reach about 76,000, in 2016. Despite having recorded far fewer sales than GM & Ford, the companies are valued similarly.

To overcome this shortfall, founder Elon Musk announced plans to expand the production to 500,000 cars in 2018. GM in contrast, sold 546,838 cars in U.S. retail alone in the first quarter of 2016. A recent Tesla study report showcased a 70% growth in sales, with the company having sold 25,000 cars within three months of the present year.

Tesla’s rise reflects a wider conviction. This California-based car company attracts customers with specified hi-tech demand, unlike the cautious customer of a family most probable to buy a sedan. The business is growing rapidly, as this company has a firmer grip on technologies, and is open to integrating automation for a convenient driving experience.

GM on other hand, has a track record of robust financial performance and is focused on delivering results. To combat the existing competition, GM’s strategy has now included raising investments in autonomous technology and commitment in delivering excellence.

Tesla is quite aware of the reality that it is still an emerging player as far as the other market giants on America’s roads are concerned. Industry experts are rather skeptical about Tesla’s ability to meet the ambitious plan it has laid out and its agenda to go mainstream with electric cars. However, the company’s strategy in launching Model 3, specifically aimed for the mass market and supposed to achieve delivery targets, thereby making electric car available to a wider consumer base, is an indicator that this automotive enterprise is poised for remarkable growth.

Tesla depicting signs of getting its production under control is likely to blow away the doubts that had been gathering around the minds of prominent investors. It wouldn’t be incorrect to state that Tesla, a small Silicon Valley start-up, has come up the hard way in the business world to become the largest US car company and has achieved a significant milestone.



About Author

Shikha Sinha

Email: [email protected]   

Shikha Sinha

Shikha currently manages content operations for a series of news and business portals including MSF, Algosonline, and the like. An electrical & electronics engineer by education, she has prior experience in content & technology writing, content marketing, market resea...

Read More

More News By Shikha Sinha

Taiwan’s Formosa Phase II commercialization to commence in 2019
Taiwan’s Formosa Phase II commercialization to commence in 2019
By Shikha Sinha

After having recorded an electricity generation capacity of 6.5 MW from Formosa I – Taiwan’s 1st commercial-scale offshore wind project, the country is all set to boost its capacity to approximately 120 MW by...

Verizon to hand out pink slips to nearly 15% of AOL-Yahoo workforce post the formal acquisition of Yahoo
Verizon to hand out pink slips to nearly 15% of AOL-Yahoo workforce post the formal acquisition of Yahoo
By Shikha Sinha

Yahoo’s sale to Verizon, which created waves of frenzy in the tech space last year, was slated to close officially in the middle of June. The deal, worth USD 4.48 billion was dubbed by industry experts to be one ...

Telematics to bring about a revolutionary transformation in the auto industry, IoT integrated platforms to mitigate road safety concerns
Telematics to bring about a revolutionary transformation in the auto industry, IoT integrated platforms to mitigate road safety concerns
By Shikha Sinha

A recent report debating on the subject of road and driver safety has apparently shed light on a concept that could possibly play a huge role in enhancing the safety of roads. Telematics, the superior brain child of info...