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Tesla's market value hits $500B for the first time as Elon Musk becomes the second-richest person in the world - amid claims defect allowed hackers to steal its Model X within minutes

 Tesla Inc blew past a $500billion market cap for the first time on Tuesday as shares spiked in the run-up to its addition to the S&P 500 index, extending a meteoric rally that has seen the stock gain more than five-fold this year.

Shares of the electric-car maker have risen nearly 28 percent since the S&P Dow Jones Indices decided to add the company to the benchmark index from December 21.

Its shares rose as much as 3.9 percent to a record high of $542.35 in early trading on Tuesday, valuing the company briefly at $514billion.

The recent rally boosted Chief Executive Officer Elon Musk's net worth by $7.2billion to $127.9billion, helping him overtake Bill Gates to become the second-richest person in the world, according to the Bloomberg Billionaires Index.

Musk, who was ranked 35th in January, has added $100.3billion to his net worth so far this year, according to the index.

Tesla Inc blew past a $500billion market cap for the first time on Tuesday as shares spiked in the run-up to its addition to the S&P 500 index (file photo)

Tesla Inc blew past a $500billion market cap for the first time on Tuesday as shares spiked in the run-up to its addition to the S&P 500 index (file photo)

Tesla's recent rally boosted CEO Elon Musk's net worth by $7.2billion to $127.9billion, helping him overtake Bill Gates to become the world's second-richest person

Tesla's recent rally boosted CEO Elon Musk's net worth by $7.2billion to $127.9billion, helping him overtake Bill Gates to become the world's second-richest person

News of Tesla breaching the $500billion market cap followed less flattering reports on Monday about a security defect in the company's popular Model X SUV. 

Researchers conducting a security experiment with the COSIC group at the University of Leuven in Belgium discovered that it was possible to hack and steal the $80,000 cars through a Bluetooth key fob, according to Wired. 

The COSIC group informed Tesla about the issue in August, and a software update was created to better protect the key fobs.  


Tesla has become by far the world's most valuable automaker, despite a production that is a fraction of Toyota Motor Corp, Volkswagen AG or General Motors Co.

Last month the California-based firm posted a record revenue of nearly $8.8billion for the third quarter - putting it on track for its first-ever profitable year despite a slump across the wider auto industry.  

The electric carmaker reported a net income of $331million, or 27 cents per share, for the months from July to September on Wednesday - marking its fifth-straight profitable quarter.  

The earnings were driven by a 44 percent increase in global deliveries for the quarter, which came as US auto sales overall fell 9.7 percent from a year ago due to consumer fears about the economy hit hard by the pandemic. 

To be eligible to join the S&P 500 a company must be based in the US, have a market capitalization of at least $8.2billion, be liquid and at least half of its shares must be available to the public. Companies must also report four straight quarters of profit. 

Tesla's shares rose as much as 3.9 percent to a record high of $542.35 in early trading on Tuesday, valuing the company briefly at $514billion

Tesla's shares rose as much as 3.9 percent to a record high of $542.35 in early trading on Tuesday, valuing the company briefly at $514billion

Tesla shares have risen more than five fold over the course of this year

Tesla shares have risen more than five fold over the course of this year

News of Tesla breaching the $500billion market cap followed less flattering reports on Monday about a security defect in the company's popular Model X SUV

News of Tesla breaching the $500billion market cap followed less flattering reports on Monday about a security defect in the company's popular Model X SUV

Shares of other electric vehicle (EV) makers have also risen in the last few months as President-elect Joe Biden made boosting EVs a top priority during his campaign.

'One of the core underpinnings of the Biden platform will be around pushing clean energy and zero-emissions vehicles with hopes of accelerating the deployment of electric vehicles and public charging outlets by 2030,' Wedbush analyst Daniel Ives said in a note.


Ives said he expects global demand for EVs will triple in the next four years, climbing from its current three percent of total auto sales to 10 percent by 2025. 

'We believe this demand dynamic will disproportionately benefit the clear EV category leader Tesla over the next few years especially in the key China region which we believe could represent ~40% of its EV deliveries by 2022, given the current brisk pace of sales with 150K+ deliveries in its first year out of the gates with Giga 3,' Ives wrote.

The projections spell good news for Musk, whose 20 percent stake in Tesla accounts for about three-quarters of his net worth.  

The South African-born CEO's jump to the second slot on the Bloomberg Billionaires Index comes just weeks after he passed Mark Zuckerberg to become third-richest.  

Amazon founder Jeff Bezos still has a comfortable hold on the top spot, with a net worth of $181.4billion. 

Gates, who held the top spot for years before being bumped off by Bezos in 2017, is now in third for only the second time in eight years.   

The Microsoft founder's net worth of $127.7 billion would be far higher if he hadn't donated roughly $45.5billion to charity over the past three decades. 

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