American electric car maker Tesla Motors will be added to the Nasdaq-100 stock index, which tracks the 100 largest non-financial companies on the stock market, starting next week.
It will be added before markets open July 15 and will replace the Oracle Corporation, which will move to the New York Stock Exchange.
Tesla's shares were up on the news, closing at $123.45 US, an increase of 1.51 per cent.
The Palo Alto, Calif.-based Tesla has a market capitalization of more than $14 billion US and has been outperforming other companies that have come out with electric cars.
Earlier this year, its Model S electric-powered sedan received the highest score ever recorded in Consumer Reports magazine's automotive testing.
"This car performs better then anything we’ve ever tested before," the publication said at the time.
The move to the Nasdaq-100 will make Tesla the only U.S. car company in the index.
Tesla outperforming rivals
As other electric car pioneers like Israel's Better Place have shut down, Tesla has continued to grow over the 10 years it has existed. It posted its first profitable quarter earlier this year, and its share price has tripled in 2013, rising above $100 US for the first time in May.
The company was co-founded by entrepreneur Elon Musk, the man behind SpaceX, the California-based company that worked with NASA to transport the first commercial supply capsule to the International Space Station. Musk also was one of the creators behind the online payment system PayPal.
Electric cars have to date had a tough time breaking into the wider automobile market — in large part because of the high cost of production. The battery alone in an electric car costs as much as a new gasoline-powered car, and Tesla's Model S starts at around $62,400 after a U.S. tax credit.
Electric vehicles are not selling nearly as fast as once projected. General Motors expected to sell 60,000 Chevy Volts globally last year, but sold just half that many. Sales of Nissan's all-electric Leaf grew 22 per cent around the world last year to 26,000, short of Nissan's projected 50 per cent growth.
Moves a sign of increasing rivalry between NYS, Nasdaq
Oracle is a computer company that has been listed on the Nasdaq since its initial public offering in 1986. With a market capitalization of $146.54 billion US, according to Nasdaq, it is the fourth largest stock on the Nasdaq-100.
When it announced its move to the NYSE in June, Nasdaq spokesman Joe Christinat stressed that Nasdaq still offered a "low-cost value proposition" and "one of the most liquid stocks in the world."
Oracle grew "nearly 10,000 per cent while listed on the Nasdaq," he reminded investors.
Prior to Oracle's move, the biggest company to defect from the Nasdaq to the rival NYSE was Kraft Foods.
Although historically, Nasdaq has been seen as the home of technology stocks, and the NYSE attracted blue-chip companies, the two exchanges have been competing for business more and more of late. Texas Instruments Inc. recently chose Nasdaq over NYSE, as did Facebook.
Oracle was down in Friday trading, closing at $31.515 US on the Nasdaq, a drop of 0.41 per cent.