Tesla Motors Inc. shares only needed to go on sale for one day for the company’s stock price to rise by 36.1%. The starting price was $19 and dropped as low as $17.55 and then shot up to $23.89 by the day’s end, making it the second highest initial price gain this year.
Tesla Motors stock price increase was only beaten by Financial Engines Inc. that saw a 44% rise in share prices on its debut public offering in March this year.
It’s good for the company and for the morality of the electric car, it’s also good for Elon Musk, the company CEO, who was facing financial hardship earlier this year – although, his idea of ‘financial hardship’ is probably much lighter than ours. Tesla only sold around 1000 of its Roadster sports cars since its debut in 2003, and thus hasn’t had a profitable quarter since.
The Model S, to be released to the public in 2012, is expected to sell very well though and Tesla plans to build around 20,000 of them. The four-door sedan has already sparked big interest in the American market with punters praising the more-affordable price range, expected to start at around $50,000. This makes it much more affordable than the $110,000 Roadster which only has two seats.
Musk was happy with the public interest as the shares soared though, saying, “The response from investors has been tremendous, we increased the size of the offering and the demand was still enormous, so we increased the price to a dollar above the top of the range and we still had massive, overwhelming demand.”
Elon Musk made an appearance at Times Square on Tuesday morning to signal the start of trading. He also brought five Tesla cars, including a Roadster, to mark the occasion.
Tesla shares are trading on the Nasdaq under the symbol ‘TSLA’.