Tesla's historic IPO outpaces expectations

Electric car company Tesla Motors will today become the first US car company to obtain a stock market listing since Ford's debut in 1956.

The high-profile firm is poised to far exceed expectations with its initial public offering (IPO), raising an estimated $226m.

The company yesterday said that it would sell 13.3 million shares at $17 each, outstripping earlier plans to sell 11.1 million shares at between $14 and $16 each.

The move means the firm will exceed last week's predictions that it would raise $178m and dwarf initial plans to raise $100m.

The shares sold equate to around 14 per cent of the company, excluding additional shares the underwriters have the option to purchase. The pricing means that the company is now valued at about $1.6bn, exceeding Tesla's own expectations that its market capitalisation would reach $1.4bn.

Telsa said it would use the money raised through the IPO to accelerate the expansion of its network of dealerships and provide working capital as it seeks to execute plans to deliver a portfolio of electric vehicles.

The company has made its name through its $109,000 Roadster electric sports car, but its long-term expansion plans rest on the development of a series of more affordable models.

The company is planning to launch an electric sedan, known as the Model S, by 2012. In a series of presentations with potential investors last week, chief executive Elon Musk outlined proposals for a fleet of electric vehicles, including a minivan, SUV and a mass market car.

Attention will now turn to how the company's stock performs on its first day on the Nasdaq, where it has been assigned the ticker symbol TSLA.

The company is widely regarded as one of the leading players in the emerging global market for electric vehicles and its IPO will further fuel optimism that investor interest in clean tech stocks is recovering fast.

However, some analysts have warned that the company faces numerous risks, noting that it is likely to remain loss-making until the Model S is launched. Tesla can also expect to see competition in the green vehicle market intensify as established auto firms launch their own electric and low-carbon models.