Tesla’s Terafab Gambit and SpaceX Windfall Reshape the Valuation Debate

With SpaceX's Nasdaq debut and a $25B chip joint venture, Tesla's market cap tops $1.5 trillion. Record Shanghai output and FSD progress fuel a 24% yearly gain.

Elon Musk has never been one to let his companies operate in silos, and the market is finally starting to price that in. With SpaceX’s Nasdaq debut on 12 June valuing its long-time affiliate, Tesla is no longer being judged purely on vehicle deliveries. The stock, trading around €354.55 in Germany and back above the psychologically important $400 mark in New York, has pushed the company’s market capitalisation back over $1.5 trillion. Yet the rally masks a deeper question: is Tesla an automaker, a chip designer, or a platform company? The answer holds the key to whether the current price is cheap or expensive.

The immediate catalyst for the renewed optimism is SpaceX’s public listing. Tesla holds roughly 19 million shares in the space venture, a stake worth about $2.56 billion at the offer price. That hidden treasure is now visible on the balance sheet, nudging investors to view Tesla as a broad technology ecosystem rather than a car manufacturer. The secondary effect has been a 24% year-on-year gain on the German exchanges, pulling the stock within striking distance of its 52-week high of €424.10 from December 2025.

But the bigger transformation is happening on the ground in Texas. In March 2026 Tesla unveiled the Terafab project: a $25 billion chip factory in Austin, developed jointly with SpaceX and Intel. The goal is outright independence from external semiconductor suppliers. On 15 April came the tape-out of the AI5 chip, the moment the final design is handed to fabrication. This processor is the brain for full self-driving without human oversight and for the Optimus humanoid robot. The logic is brutal: having poured billions into AI software, Tesla cannot afford to depend on third-party silicon.

That explains why Tesla has pencilled in capital expenditure of over €25 billion for 2026 alone. It is not expansion for expansion’s sake; it is the price of reinventing itself as a technology platform. While Austin builds the future, Shanghai finances the transition. Giga Shanghai delivered nearly 86,000 vehicles in May 2026, a monthly record for the year, providing the cash flow that underwrites such ambition. Meanwhile, €250 million is flowing into Giga Berlin to lift 4680 battery cell capacity to 18 GWh annually, insulating European operations from tariff risks posed by Chinese rivals.

Operational momentum extends beyond production lines. In Europe, new foldable Supercharger units are being rolled out, each delivering up to 500 kW across eight charging points. In Germany, Tesla registrations surged 322% year-on-year in May, while in Denmark the Model Y topped the overall vehicle sales charts. The latest version of the Full Self-Driving software is also making strides; independent tests in Los Angeles show the system handling complex urban routes without human intervention more consistently.

The investment case, however, remains sharply divided. The consensus analyst target stands at €362.78, a modest 2.3% upside from current levels. JPMorgan has begun factoring in energy storage, robotics and infrastructure licensing, moving away from a traditional price-to-earnings framework. At the extremes, ARK Invest projects a $2,600 price target for 2029, betting heavily on the robotaxi opportunity, while Barclays sticks to a twelve-month target of $360.

Technical indicators offer little clarity: the relative strength index at 50.6 signals neither overbought nor oversold. The stock is still 41% above its July 2025 low of €251 but remains far from the December 2025 peak. Elon Musk has dismissed criticism that his companies rely too heavily on subsidies, arguing that combined government support for Tesla and SpaceX amounts to less than 2% of their enterprise value. The removal of former tax credits, he says, actually boosted Tesla sales as buyers shifted away from less efficient competitors.

Controversy continues to stalk the brand. Demonstrators in Geneva set a Tesla on fire during G7 protests, and in Singapore police arrested a man who attempted to bypass vehicle security using a signal jammer — only to be caught by the on-board Sentry Mode cameras.

Autumn will bring the real test. Tesla plans to start series production of the Optimus 3 robot, turning a promise into a product. Until then, the stock sits in limbo between a car company valuation and a platform one, with a $25 billion chip factory and a $2.56 billion SpaceX stake as the twin pillars of a new narrative.