Investors conclude that Tesla is a carmaker, not a tech firm
A share-price rout suggests they no longer think it will take over the world
After Tesla’s market capitalisation swept past that of Toyota, then the world’s most valuable car company, in the summer of 2020, devoted fans and incredulous sceptics deployed a new unit of measurement. As the electric-vehicle (EV) champion’s share price rose, its worth was couched in terms of the combined value of the next two, then five, then ten biggest carmakers. A year ago Tesla’s market value surpassed $1.2trn, more than most other car companies put together. Since then it has lost 71% of that—a sum exceeding the value of most of the industry. The fortune of its mercurial boss, Elon Musk, has shrivelled by more than $200bn as a result.
This article appeared in the Business section of the print edition under the headline “The Tesla conundrum”
From the January 7th 2023 edition
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