That isn't to say that Tesla is without its warts. A large portion of the share price move is being driven by short covering, and that will end at some point. The company also generates a significant portion of its cash flow and risk management from its regulatory credits, Jonas noted. "Credits such as ZEV (Zero Emission Vehicle credits) and GHG (Greenhouse Gas credits) that Tesla accumulates from a surplus of long-range EVs that they can sell to competing manufacturers at auction are a big deal to Tesla." The regulatory environment on selling credits could change in the future, so this is something Tesla will need to keep an eye on. It's worth noting that Tesla has said in the past that it doesn't want to rely on selling credits for the long-term.
Tesla appears to have become the first company to successfully break the hold of the "Detroit 3" (Ford, GM and Chrysler) in garnering attention and mind share as an American automaker.
The company is still in its early growth stages, so it's going to be a while before anyone has any idea just how large the market is for electric cars. One thing is clear, though. Tesla is here to stay, and it's off to the races. Enjoy the ride while it lasts.
-- Written by Chris Ciaccia in New York>Contact by Email. Follow @Chris_Ciaccia