The Initial Public Offering (IPO) for electric car start-up Tesla Motors is scheduled for tomorrow June 29th. The company will put 13.3 million shares of stock on sale to the public in order to raise some much needed cash. Tesla shares are expected to open between a range of $14 to $16, at which price the Silicon Valley electric car company will debut with a $1.5 billion market cap. Elon Musk, the founder who appears to be rich only on “paper” will be Tesla’s largest shareholder. Daimler will own the second most shares and the Abu Dhabi government will be the third largest shareholder. This IPO will be carefully watched, as it could show investors’ interest in and willingness to bet on the nascent electric car market in general. An enormous amount of money is needed to break through the high barriers to entry in the car industry. Tesla has raised over $750 million so far but is still losing money. While its electric sports car, the Roadster, has received good reviews, at $100,000 a pop it remains a toy for the wealthy. The company’s future is being wagered on their Model S sedan, which aims to compete with GM’s volt in the still pricey range of $40,000 – 50,000.
This is the first IPO for a U.S. car company since Ford went public in 1956.
[Image credit]
Posted in 
Tags: 
