That's a whole lot of zeros.
Only six companies in the world are worth at least $1 trillion. Tesla is now one of them. Following the announcement earlier this week of rental car company Hertz's $4.4 billion order for 100,000 units of the Tesla Model 3, the EV automaker's shares rallied more than 12 percent. Shares closed that day at $1,025. Combined with an influential Morgan Stanley auto analyst raising his Tesla target share price to $1,200, the automaker has hit that $1 trillion mark.
It joins an exclusive club of companies that have already done so, including Apple, Google's parent company Alphabet, and Amazon. Tesla is the second-fastest company to ever reach this value following its founding over 12 years ago.
Only Facebook beat it to the punch when it was around 9 years old. Heck, it took Apple 37 years to do so. CEO and co-founder Elon Musk has a 23 percent stake in the company. He's now worth about $230 billion. Just to give everyone an idea of how much more valuable Tesla is compared to rivals, the world's second most valuable automaker, Toyota, has a market cap of around $280 million. All the more impressive is that Tesla produces far fewer vehicles annually than Toyota.
Last year, Tesla sold half a million cars globally. Toyota sold around 9.5 million vehicles. So far in 2021, Tesla has sold some 627,000 vehicles and counting.
It'd very much like to reach 1 million before the end of the year. Okay, so how and why is Tesla worth so much more than every other automaker when it produces relatively far fewer cars annually? Because of its influence, specifically in innovative technology, design, and general consumer demand.
The question now is whether Tesla will remain part of the $1 trillion company club. Chances are it will. It's about to open two new factories (Austin and Berlin), launch new vehicles (the Cybertruck), and continue to release updated versions of its Full Self-Driving driver-assist technology. Much to the chagrin of legacy automakers, Tesla's influence is showing no signs of slowing down.