Tesla soars past $1,000 a share after Elon Musk seizes on Nikola’s hype
Elon Musk wasn’t about to let a revenue-less manufacturer of zero-emission semitrailer trucks steal the spotlight from Tesla Inc.
The Tesla chief executive sent an email to employees before the stock market opened Wednesday declaring that it is “time to go all out” and put Tesla’s Semi into volume production. Musk didn’t give a time frame for when he expects mass output to actually happen. Just six weeks ago, Tesla said it was postponing initial deliveries to 2021, roughly two years later than initially planned.
If Musk was looking to regain the attention of any investors whose eyes had wandered toward Nikola Corp., the market got the memo. Tesla’s stock surged above $1,000 a share for the first time, while shares of newly listed Nikola fell after days of hype about its plans to bring battery-electric and fuel-cell haulers to market in the coming years.
“This is Elon making noise because of Nikola,” said Ben Kallo, an analyst at Robert W. Baird. He said other factors were also fueling Tesla shares’ rise, including strong sales in China and the anticipation of a “Battery Day” event as soon as this month.
The billionaire founders of Nikola and Tesla have a lot in common
Tesla shares leaped 9% on Wednesday to $1,025.05, lifting the company’s market capitalization to $190 billion. It’s gaining ground on Toyota Motor Corp., which at more than $215 billion is the world’s most valuable auto company.
Nikola shares fell 18.5% on Wednesday after advancing 122% the prior two days. The company is planning to start delivering a battery-electric semi next year, followed by fuel-cell rigs in 2023.
“Given some of the other news flow in the past month to two months on the Class 8 truck market, I think [Musk is] probably trying to keep Tesla in the marketing cycle just for all the mega trends going on in trucking,” said Jeff Osborne, a Cowen & Co. analyst. He rates Tesla the equivalent of a sell.
Trevor Milton, Nikola’s 38-year-old founder, took Musk’s memo in stride.
Musk “is almost unstoppable and I love it,” Milton said on Twitter. “It’s Nikola and Tesla battling to stop emissions. Don’t ever count Elon out and don’t expect me to stop working hard to compete against you. Congrats on the shareholder value! Few have ever done what you’ve done Elon.”
Reuters first reported Musk’s email to Tesla employees earlier Wednesday. The CEO confirmed its authenticity in a tweet.