Tesla shares soar 13% and its market value exceeds a trillion dollars

Tesla

Tesla surpasses a trillion dollars in market capitalization on Monday, after the company founded by Elon Musk received its largest order from Hertz, which announced plans to buy 100,000 electric cars for rent.

Tesla shares are up 13.2% to a record $1,028.42. At over $995.75 per share, the company reached a value of one trillion dollars. In this way, the world’s most valuable automaker joins an elite club that includes Apple, Amazon.com, Microsoft and Alphabet (Google).

Hertz Acting Chief Executive Officer Mark Fields said the order, which will be delivered in late 2022, will be primarily for Model 3 vehicles. Cars will become available at Hertz rental facilities in November.

It is worth noting that the firm’s Model 3 recently became the first electric vehicle to lead the monthly sales of new cars in Europe.

The Hertz news comes as Tesla is grappling with a backlog and ongoing supply chain disruptions, but solidifies the overall appeal of electric cars.

Musk’s company delivered a record 241,300 electric cars to the world in the third quarter, even as it warned of supply chain difficulties that would put pressure on margins.

Most automakers don’t boast about sales to rental companies, which are often discounted for low-selling models, but for Tesla and its investors, Hertz’s decision shows that electric vehicles are no longer a niche product.

“We absolutely believe it will be a competitive advantage for us,” Fields said of the order. “We want to be leaders in mobility (…) That customers feel the experience of electric vehicles is a top priority for us.”

Hertz has between 430,000 and 450,000 vehicles worldwide, Fields said, adding that the firm will work with other automakers that make electric vehicles.