Tesla’s market value has climbed above Volkswagen Group’s for the first time to more than $100bn, a threshold that will make Elon Musk even more of a billionaire if he can sustain that level of market value for months.
Many are skeptical that Tesla should be worth more than a carmaker that sold almost 30 times as many vehicles last year, but VW CEO Herbert Diess isn’t so dismissive. He’s been arguably the most vocal CEO among traditional carmakers to praise Tesla and point to its role in a radical shakeup of the more than century-old auto industry.
After saying three months ago that Tesla are no longer a niche manufacturer, Diess told top VW executives last week that connected vehicles will almost double the time consumers spend online, and that cars will “become the most important mobile device”.
Diess is rolling out the industry’s largest electric-car fleet and aims to boost the company’s value to a level rivaling Toyota, whose $232bn market cap is still more than Tesla and VW combined.
Stefan Bratzel, a researcher at the Center of Automotive Management in Germany, says Tesla have “high innovative strength regarding battery-electric vehicles as well as connectivity, which can partly explain the high market capitalisation”. The relatively low valuation of traditional automakers is linked to uncertainty over whether they can navigate the looming industry shift, he said.
