Elon Musk says that Hertz deal has zero affect on Tesla’s 1 Trillion Dollar Valuation as till now no deal has been signed yet
After Hertz announced a deal that pushed Tesla’s market value beyond $1 trillion, Elon Musk claims no contract has been signed with the rental car firm.
Tesla’s stock rose 12.6 percent last week when Hertz announced it has placed an order for 100,000 vehicles by the end of 2022.
“I’d like to underline that no contract has been signed yet,” Mr Musk tweeted.
Both firms have been contacted for comment.
The Hertz-Tesla agreement was the largest-ever rental car order for electric automobiles.
“Electric vehicles have become mainstream, and we’ve only recently began to witness increased global demand and interest,” said Mark Fields, interim CEO of Hertz.
Hertz is expected to pay $4.2 billion for 100,000 Model 3 cars over the next 14 months, accounting for nearly a fifth of its fleet. The rental company would also set up a charging station network.
Customers will be able to rent a Tesla Model 3 at Hertz airport and neighbourhood sites in some areas in the US and Europe “beginning in early November and expanding through year end,” according to Hertz.
Tesla CEO Elon Musk, on the other hand, tweeted on Tuesday, “Tesla has considerably more demand than production, so we will only sell vehicles to Hertz at the same margin as to consumers.”
“The Hertz agreement has no bearing on our profitability.”
On October 25, Tesla became the sixth business to reach a market capitalization of $1 trillion, trailing Apple, Microsoft, Amazon, and Alphabet, the parent company of Google.
You’re welcome!
If any of this is based on Hertz, I’d like to emphasize that no contract has been signed yet.
Tesla has far more demand than production, therefore we will only sell cars to Hertz for the same margin as to consumers.
Hertz deal has zero effect on our economics.
— Elon Musk (@elonmusk) November 2, 2021
Mr Musk said it was “funny that moved valuation, given Tesla is very much a production ramp problem, not a demand problem” in response to a tweet about the Hertz deal on October 25.
“To be clear, cars sold to Hertz do not receive a discount,” he later said. Consumers pay the same price.”
It isn’t the first time that Mr Musk’s company-related tweets have created headlines.
After tweeting that the carmaker’s share price was too high, he shaved $14 billion (£11 billion) off its value in May 2020.
Two years ago, a tweet on Tesla’s future on the New York stock exchange resulted in a $20 million fine from authorities, as well as Mr Musk agreeing to have all future posts on the site pre-screened by attorneys.
On Tuesday, Tesla announced the commencement of a 10-station “supercharger” pilot in the Netherlands, which will be open to all electric vehicle (EV) models.
The business added that opening up its charging stations to non-Telsa drivers was “essential for large-scale EV adoption” as part of its charging network expansion ambitions.
