Shares in upscale electric car company Tesla Motors made big gains Tuesday — its first day of trading.
The stock rose as much as 11 per cent, defying a general downward trend in North American markets.
In the early afternoon, Tesla shares were $1.75 US higher to $18.75 US, after reaching $19 US earlier.
Tesla had launched a $226-million US IPO, selling 13.3 million shares at $17 US each earlier in the day, the first time in more than 50 years that an American automaker has gone public.
The electric car company, manufacturer of the high-performance all-electric Tesla Roadster, originally offered the shares in a range between $14 US and $16 US. The California-based company will use proceeds to pay for factories and possible acquisitions.
On Monday, the company raised the number of shares that would be going public by 20 per cent. The majority of these new shares came from Tesla CEO and co-founder Elon Musk, who sold almost one million of his personal shares in the hopes of reaching the $244 million US figure.
Musk, a graduate of Queen’s University in Kingston, Ont., is Tesla’s biggest shareholder, with a 28 per cent stake in the company. He also co-founded PayPal and is CEO of Space Exploration Technologies Inc., a Hawthorne, Calif.,-based company that builds spacecraft.
Tesla has some high-profile backers. Last month, Toyota Motor Corp. agreed to sell Tesla its shuttered factory in Fremont, Calif., and invest $50 million in the company once its IPO closes. Tesla plans to use the factory to eventually build a sedan.
Electric car technology has also been strongly supported by U.S. President Barack Obama as part of a larger strategy to shift dependence from oil to alternative energy sources.
The Roadster has already garnered celebrity status with purchases by Brad Pitt and George Clooney earlier this year.