Silicon Valley electric vehicle maker Tesla started life as a public company with shares already up 12pc when the markets opened yesterday and ended the day with the share value up 40pc.
Tesla’s IPO – the first by an American car maker since Ford floated in 1956 – had an initial offering price of US$17 and a market capitalisation of US$1.6bn.
However, shares opened almost 12pc higher at US$19 on the US Nasdaq exchange. By the afternoon, the shares finished trading at US$18.75, up 10.3pc.
Shares closed at US$23.89, up US$6.89 from the initial offering price of US$17, giving the company a market value of US$2.2bn.
The company originally expected to sell 12.3m shares, priced at US$14 and US$16.
However, analysts expect Tesla to be a pretty volatile stock, with doubts among consumers over the effectiveness of electric vehicles and the fact Tesla won’t be selling a new flagship vehicle until 2012 and has lost US$290.2m since it started in 2003.
With fuel prices rising and growing environmental awareness, however, Tesla is banking its future success on the launch of the Model S four-door electric sedan.
Tesla’s high-profile backers include CEO Elon Musk, co-founder of PayPal, Toyota, which has sold Tesla a manufacturing plant in California, and the US Energy Department, which has loaned Tesla US$465m.
So far, Tesla has sold 1,000 of its two-door Roadster, which is priced at US$100,000.
The company’s goal is to build 20,000 Model S sedans a year at more than US$50,000 a pop.