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(EDITORIAL from Korea Times on April 7)

All News 07:13 April 07, 2017

Korea needs more Teslas
Time to foster innovators to get ahead in future tech war

Tesla made headlines this week when the electric carmaker vaulted beyond Ford to become the second-largest U.S. carmaker in terms of market capitalization. The latest figures showed that Tesla's market value reached around $49 billion while Ford fell behind with about $46 billion.

The surge came after the California-based company reported record vehicle deliveries in the first quarter. Tesla sold more than 25,000 units in the first three months of the year, up 70 percent from the same quarter last year, while competitors' sales faltered. In an effort to break into the mass market, Tesla will launch the Model 3 sedan later this year. If Tesla maintains this momentum, its market value could surge past the largest U.S. carmaker GM, which has a market cap of about $51 billion.

In terms of market value, Tesla has some more catching up to do with global rivals such as Toyota, which has a market cap of $160 billion, Volkswagen, BMW Group and Honda, among others. But it is fascinating to see the swift rise of the 14-year-old electric carmaker to become a new member of the Big 3 in the U.S. auto industry with giants like Ford and GM that have been around for more than a century.

Tesla surpassing Ford in market value for the first time shows that investors are excited about the future of the electric car company.

The investors' optimism is based on the potential for dramatic growth of Tesla, which has some huge plans beyond the auto industry. Its other ventures, including the SpaceX rocket program and the SolarCity solar roof installations, demonstrate Tesla founder and CEO Elon Musk's challenging spirit.

Tesla's success should be a catalyst for the transformation of the local auto industry to produce ecologically safe and connected cars.

The rise of Tesla also shows it is no longer just conventional leaders but emerging companies that are leading the wave of technological innovations.

Tesla poses a challenge for the domestic industry to pursue new ways of survival in the Fourth Industrial Revolution. Korea is already falling behind global rivals such as the U.S., China and Japan in developing futuristic technologies such as self-driving cars, 3D printing, AI and drones. China, for example, has been leading the drone market, with companies like DJI, which has become the world's biggest manufacturer in just 10 years.

The next president's biggest priority is to create an environment where tech startups can flourish so we can start catching up with our global rivals.

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