© Reuters. FILE PHOTO: VW organizes photography workshop at Zwickau plant
By Thyagaraju Adinarayan and Christoph Steitz LONDON / FRANKFURT (Reuters) – As the market value of Germany’s Volkswagen (DE 🙂 rose above the € 100 billion mark on Wednesday for the first time since 2015, the manufacturer’s boss Normally serious carmaker took to Twitter, Elon Musk-style, to brag about it. VW shares soared as much as 6% after investment bank UBS raised its price target on the shares by 50% and said the company’s new electric vehicle platform was ready to challenge Tesla’s dominance ( NASDAQ 🙂 in the battery electric vehicle (BEV). market. Herbert Diess, CEO of VW Group, highlighted the UBS note on Twitter and shared the market capitalization milestone. “The market has been waiting for our # BEV-ramp-up and wanted to see some test points,” Diess posted. Traders reacted by comparing them to Tesla boss Elon Musk, who frequently uses Twitter to talk about products developed by his companies, cryptocurrencies or other trendy technologies. The comparison, for now at least, should end there. Deiss sent his first tweet using the identifier “@Herbert_Diess” less than two months ago and has since tweeted 51 times. While he has amassed nearly 25,000 followers in this time, Musk can boast 48.3 million. “The mere fact that you have opened your own account apart from the official VW account tells me that, between the lines, you want to say: We are here,” said a German-based trader. But despite recent stock price gains, up 20% this year, VW’s market capitalization is only one-sixth that of Tesla. Shares are trading 7.5 times 12-month earnings; its role in the transition to electric vehicles may not be fully appreciated. Meanwhile, Tesla is trading at 160 times future 12-month earnings, levels many consider bubble-like. As for the market capitulation gap, UBS said VW only looks at its EV business until 2025, and does not price its cash-rich legacy business, indicating there is room for the share price goes up. Expect VW to close the volume gap with Tesla in 2022.