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Data: FactSet; Chart: Axios Visuals

Tesla's market capitalization blew past $500 billion for the first time Tuesday.

Why it matters: It's just a number, but kind of a wild one. Consider, via CNN: "Tesla is now worth more than the combined market value of most of the world's major automakers: Toyota, Volkswagen, GM, Ford, Fiat Chrysler and its merger partner PSA Group."

What's new: Tuesday also brought some more nuts and bolts Tesla news. CEO Elon Musk said they're planning a small car for European markets to be built at its upcoming German factory, per Bloomberg.

  • "In Europe, it would make sense to do a compact car, perhaps a hatchback," he said at an online battery conference.

The big picture: Stocks move around for all kinds of reasons, but it's safe to say that investors see lots of growth potential for Tesla — and EVs in general, particularly with tailwinds from Joe Biden's win.

Between the lines: Tesla's market stature is also benefitting from its upcoming arrival in the S&P 500. Business Insider looks at what's in store...

  • "Of the 189 large-cap funds tracked by Goldman Sachs, 157 that manage roughly $500 billion didn't hold any Tesla shares as of September 30, the bank's analysts said Thursday."
  • "Those funds are set to buy $8 billion worth of shares once Tesla joins the index, according to Goldman."

Of note: Tesla is not alone. The share price of several public EV companies have been rising, and a whole bunch of others are about to go public.

What we're watching: How much Biden boosts U.S. deployment beyond the existing trajectory.

  • He wants big investments in charging and expanded consumer incentives.
  • The latter in particular would help Tesla, which is well past the 200,000-per-manufacturer limit for the $7,500 consumer tax credit.
  • But Biden's plans will be constrained by likely GOP control of the Senate.

The intrigue: Wedbush Securities analyst Dan Ives, in a note and email exchange, said GOP lawmakers could be on board with some kind of new EV incentives.

  • He argues the big investments that GM, Tesla, Ford and others are making in coming years will broaden their bipartisan political appeal, even though EVs are now just around 2% of U.S. sales.
  • It's partly due to geography, as EV manufacturing is expanding into states like Texas, where Tesla is building a factory, as well as Arizona and elsewhere.
  • All this spending and activity "creates a compelling scenario for many in the Beltway to support," his note states.

The bottom line: Overall, he sees lots of coming demand.

  • That's driven by China (which Ives sees accounting for 40% of Tesla deliveries in 2022), EU carbon regulations, new U.S. support, and a domestic industry that's "laser focused" on EVs (especially Tesla and GM).

Go deeper

Jan 22, 2021 - Economy & Business

What Biden's EV push could mean for jobs

Illustration: Sarah Grillo/Axios

President Biden's swift effort to re-establish stricter fuel efficiency mandates, along with his broader push toward vehicle electrification, is as much about creating new jobs as it is protecting the environment.

Why it matters: The U.S. lags far behind the rest of the world in electric vehicle adoption. Catching up will require big investments in EV production — including battery cell manufacturing and mining of raw materials — to avoid dependence on imports and foreign supply chains.

16 mins ago - Politics & Policy

Biden's latest executive order: Buy American

President Joe R. Biden speaks about the economy before signing executive orders in the State Dining Room at the White House on Friday, Jan 22, 2021 in Washington, DC. (Photo by Jabin Botsford/The Washington Post via Getty Images)

President Joe Biden will continue his flurry of executive orders on Monday, signing a new directive to require the federal government to “buy American” for products and services.

Why it matters: The executive action is yet another attempt by Biden to accomplish goals administratively without waiting for the backing of Congress. The new order echoes Biden's $400 billion campaign pledge to increase government purchases of American goods.

Tech digs in for long domestic terror fight

Illustration: Sarah Grillo/Axios

With domestic extremist networks scrambling to regroup online, experts fear the next attack could come from a radicalized individual — much harder than coordinated mass events for law enforcement and platforms to detect or deter.

The big picture: Companies like Facebook and Twitter stepped up enforcement and their conversations with law enforcement ahead of Inauguration Day. But they'll be tested as the threat rises that impatient lone-wolf attackers will lash out.