Tesla became the world’s most valuable automaker by market capitalization after surpassing Toyota in July 2020.
Tesla’s stock rose sharply as investors priced in rapid growth in electric vehicles, battery technology, and software-supported driving features. Toyota remained a much larger producer by vehicle volume, but market capitalization measures investors’ valuation of future earnings rather than current production.
The milestone illustrated the difference between manufacturing scale and stock-market value. Tesla produced far fewer vehicles than Toyota at the time, yet investors assigned the electric-vehicle company a higher equity valuation.
Tesla was founded in 2003 and delivered the Roadster, its first production vehicle, in 2008. The Model 3 later helped the company move toward higher-volume production.