In one of the largest-ever purchases of electric vehicles, Hertz will spend US$4.2 billion on the cars, about US$42,000 per car, Bloomberg News reported. The announcement pushed Tesla shares up more than 12% and added almost US$118 billion to the company’s market capitalization. Tesla is now the fifth-most valuable publicly traded company in the U.S.
That a deal with a recently-bankrupt rental car company is what pushed Tesla over US$1 trillion in value surprised even Tesla CEO Elon Musk who tweeted that the company has plenty of demand for vehicles.
Strange that moved valuation, as Tesla is very much a production ramp problem, not a demand problem
— Elon Musk (@elonmusk) October 25, 2021
Even stranger, Hertz, the buyer in this deal, gained US$1.17 billion in value on the announcement. It’s an unusual turn of circumstances for a company that spent most of the summer valued at less than US$8 billion.
Musk may not want to look this gift in the mouth. Tesla’s stock surge solidified his position as the richest man on Earth, boosting his net worth by US$36.2 billion today alone. He’s now valued at US$288.6 billion, according to the Bloomberg Billionaires Index.
Photo: Bloomberg
