Toyota sells more than 10 m vehicles annually, and has a market capitalization of $177 b. So do Volkswagen and General Motors, which have a market-cap of $74 b and $51 b respectively. Renault-Nissan together sell close to 10 m vehicles; Renault's equity is worth $25 b, and Nissan's $40 b. Hyundai sells more than 7 m vehicles, and is worth $37 b. Ford sells more than 6 m vehicles, and market considers it worth $46 b. Fiat-Chrysler is worth $21 b, and sells more than 5 m vehicles. Then there are Honda, more than 4 m vehicles and $54 b, Peugeot-Citron, more than 3 m vehicles and $15 b, and Suzuki, more than 3 m vehicles and $20b.
And we have Tesla, which sold 50,700 vehicles in 2016, and its equity is worth $48 b. Isn't this amazing?
Tesla was worth $4 b in April 2012.
During the period, Tesla has overtaken its competitors on the stock markets with enough pizzazz. This story has it, and I picked those pictures.
And recently it went past Nissan.
The story is has warning for the other automakers.
But then Tesla is not about only auto, is it? And boy, did it embarrass Ford.
If it is no longer an auto manufacturer, what is it? It is a vertically integrated energy company as per its latest annual report.
Tesla sells Model S sedan and Model X SUV electric cars, which are meant for high-end consumers. It has plans to manufacture and sell mass market Model 3 electric cars in 2017. It also sells energy storage products. Post acquisition of SolarCity, it sells renewable energy.
So there it is; Tesla is not only an auto manufacturer. As such, it is not fair to compare its market-cap with other auto companies. But then, it is fair to compare its business with its market value.
Tesla incurred a loss of $675 m on revenues of $7 b in 2016, and so far, auto revenues form a significant part.
As of December 2016, Tesla had $3.5 b cash, and debt of $7 b. It had negative operating cash flows of $124k, and $1.4 b of capital spending. Currently, it has been funding the gap through issue of new equity and raising debt. It also has a much higher order booking for vehicles, more than 400,000 apparently.
In November 2016, Tesla acquired SolarCity for $2.1 b through issue of Tesla shares priced at $185.04 per share. As of now, each Tesla share is trading at $298.52. It is not clear what was the actual acquisition price especially when CEO of Tesla was also the Chairman of the board of SolarCity, having a 22% ownership in SolarCity. Not surprisingly, the CEO of Tesla got 22% of new shares issued by Tesla; not a bad deal. How about the minority shareholders of Tesla?
Elon Musk has a different take:
Where does Tesla go from here?
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