Tesla Zooms Past $1 Trillion In Market Capitalization

Tesla Inc. topped $1 trillion in market value to begin the week after landing its biggest-ever order from car rental firm Hertz, Subrat Patnaik and Sanjana Shivdas and David Shepardson reported for Reuters.

Photo Insert: Tesla's profits are also hinged tightly on sales in China, where, despite fierce domestic competition, the US-based EV maker has thrived.

Tesla shares surged as much as 14.9% to $1,045.02, making it the world's most valuable automaker according to Reuters calculations based on its latest filing. Even Tesla Chief Executive Elon Musk expressed surprise at the velocity of the surge.

"Strange that moved valuation, as Tesla is very much a production ramp problem, not a demand problem," Musk tweeted in reply to a comment by Ross Gerber, co-founder of the investment fund Gerber Kawasaki and a Tesla shareholder.

"Wild $T1mes!" Musk wrote in a separate tweet.

Tesla is the first carmaker to join the elite club of trillion-dollar companies that includes Apple Inc., Amazon.com Inc., Microsoft Corp., and Alphabet Inc.

Most automakers do not boast about sales to rental car companies, often made at discounts to unload slow-selling models. But for Tesla and its investors, Hertz's decision to order 100,000 Tesla vehicles by the end of 2022 showed electric vehicles are no longer a niche product but will dominate the mass car market in the near future.

"Electric vehicles are now mainstream, and we've only just begun to see rising global demand and interest," Hertz interim Chief Executive Officer Mark Fields told Reuters. Musk has set an annual sales growth target of 50%, on average, eventually reaching 20 million vehicles a year.

That would be more than twice the volume of current sales leaders Volkswagen AG and Toyota Motor Corp. Consumer demand for electric vehicles is turning a corner in some major markets.

The Tesla Model 3 was the best-selling vehicle of any kind in Europe last month, consulting firm JATO Dynamics reported Monday.

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