Musk sees $1 trillion Tesla as shares drop over SolarCity deal

Tesla Motors chief executive officer Elon Musk says the proposed acquisition of SolarCity Corp could eventually push the electric car maker's valuation to $1 trillion, but investors were sceptical. Shares of Tesla were down nearly 7 per cent at $204.50, putting its market capitalisation at $29.8 billion (€26.408bn).

The much smaller SolarCity was up nearly 9 per cent at $23.01 (€20.39), valuing the US market leader in residential rooftop solar panels at $2.2 billion (€1.95 bn).

Tesla on Tuesday offered to buy SolarCity in a stock deal worth as much as $2.8 billion ($2.481 bn).

“I have no doubt about this - zero,” Musk, a major shareholder of both companies, said on a conference call with analyst before markets opened on Wednesday. “We should have done it sooner.”

- (Reuters)