According to AutoNation, the largest auto dealer in the United States, Tesla’s record market capitalization is inexplicable and General Motors is vastly undervalued.
In the last week, Tesla has surpassed not only Ford in investor value but also General Motors at $51 billion, raising questions about just how the company has become so valuable when it still isn’t a consistent returning or profit or anywhere close to being one of the industry’s largest companies by sales.
Speaking at a conference hosted by the National Automobile Dealers Association and J.D. Power, AutoNation chief executive Mike Jackson expressed his surprise at Tesla’s value, Bloomberg reports.
“It’s either one of the great Ponzi schemes of all time or it’s all going to work out,” he said. “It’s totally inexplicable, as far as its valuation.”
While Jackson couldn’t explain why Tesla has reached such heights, he did praise Elon Musk for creating a company with such a strong following.
“You have to tip your hat that he’s created a brand that has a strong, cult-like following,” he said.
At Monday’s close, Tesla’s value hit $50.9 billion, making it around $7 billion more valuable to investors than Ford and about $64 million more than General Motors.
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