Tesla's Share Of The Global Auto Market Is 0.8% But Its Market Cap Is 3x The Entire S&P Autos Sector

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by Tyler Durden
Thursday, Jul 16, 2020 - 11:25 AM

We have said much about the staggering surge in Tesla stock (in no small part thanks to generous "gamma gamblers" who keep buying massively OTM money call options expiring in a few days), and here, courtesy of Deutsche Bank's Jim Reid, is some more since one can never have enough Tesla.

As the credit strategist notes, Tesla is up +330% since March 18th, and over +760% since June 2019 when it was troubled by bankruptcy concerns. Just 2 weeks ago it surpassed Toyota to become the world’s largest automaker.

As the chart shows, Tesla’s market cap ($287bn) has grown to over a third of the combined market cap of the US, EU and  Japanese auto indices.

Since March, Tesla has added just over 8 Ford Motor Companies, 27 Renaults, or more than the entire market cap of Toyota. In fact, Tesla is over 3 times the size of the “S&P 500 Automobiles and Parts” sector, even though it’s not a member or in the S&P 500 (it would be the 15th largest).

According to our US Autos Analyst Emmanuel Rosner, Tesla’s overall share of the global autos market has grown from 0.1% in 2017 to an expected 0.8% in 2020, but remains minuscule. For context VW is at c.14%. However Tesla’s market share growth in its areas of focus has been particularly impressive, displacing many incumbents.

There are a few reasons for the stunning price action. Electric vehicles are seen as the future, ESG investing is growing, and Tesla is a darling of the Robinhood investment community. We see earnings next week.

For a flash survey: Do you think Tesla is overvalued or not? You can also pick don’t know. Click on the hyperlinks to vote. Answers ahead of earnings.