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Tesla’s market value jumped above Volkswagen’s, the world’s largest carmaker in terms of actual sales today.

VW sells about 30 times as many vehicles as Tesla does. But in Wall Street terms, Tesla’s market value has grown larger.

Go Shares, Go

It’s all about share price, and Tesla’s stock has been on a tear, doubling in price since the beginning of November.

(Image: Tesla)

On Wednesday, Tesla’s stock zoomed to $590 at midday Wednesday before closing at $570. Multiply either of those prices by the number of Tesla shares out there, and you get a market capitalization of at least $102 billion.

Using the same math, VW’s market cap was $100 million on Wednesday. (Tesla first steamed past General Motors, its largest domestic rival, more than two years ago.)

All this is a bigger deal on Wall Street than in the real world of carmaking. But if Tesla can maintain a market cap above $100 million for at least six months, there will be a very, very large payout for CEO Elon Musk.

Super Payday

Last March, the company’s shareholders agreed to an outlandish, all-or-nothing compensation package for Musk. He would receive big blocks of Tesla shares, but only after each time the company gained and held another $50 million in market value.

The idea was to keep Musk, whose current equity in Tesla is worth $23 billion, on as CEO for years to come. But it seemed an unlikely way to do it. Tesla shares were trading around $260, and the company’s market share was a mere $59 billion.

Many analysts believe Tesla isn’t quite ready to sustain yesterday’s lofty market cap. But they’ve certainly become more optimistic this week about the possibility.

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