This month the Californian electric car maker Tesla overtook the Italian car maker Fiat in terms of market value when it reported its first profit.
Last week, Tesla again boosted investor confidence by repaying a US$465 million US government energy loan nine years early. The payback comes after Tesla's higher-than-expected sales forecast and its newly launched Model S sedan, which is receiving some rave reviews.
"Confidence from investors stems from a range of factors and recent announcements," says the Tesla spokesman Karl Berridge. "Production and deliveries have increased to over an 80 per cent growing rate … It also, of course, marks a reaction to our future plans and some of the fantastic reviews Model S has had."
The US-based magazine Consumer Reports has given the Tesla Model S an approval rating of 99 out of 100. Jake Fisher, the head of auto testing for Consumer Reports, says the car's performance is "off the charts." The Model S has already won awards from car magazines such as Motor Trend and Automobile, but Consumer Reports is regarded as the most influential magazine among car shoppers.
Investors in Tesla are now betting that the age of the clean electric car has finally arrived and that the Californian car maker will soon start to carve itself a significant slice of the world's auto markets.
But there are also growing fears that Tesla may be benefiting more from Silicon Valley spring investor madness rather than from making any real inroads into the global market. While the very occasional luxury Tesla sports car can be sighted on the streets of the UAE, the company has projected sales of only 21,000 for the entire year.
By contrast, Fiat Group, despite being affected by the negative market trend in Italy, sold more than 68,000 new vehicles last month alone.
Tesla's first-quarter net income totalled $11.2m from a loss of $89.9m a year earlier. And while investors may have been cheered by the fact that the company is finally in the black, a profit of just over $11.2m would hardly justify Tesla's market value of more than $10 billion by any traditional stock valuation process.
"Electric cars still haven't crossed the threshold into mainstream. There are two reasons for this both relating to the batteries," says Rob Enderle, the principal analyst at the Silicon Valley-based Enderle Group.
According to Mr Enderle, the cost of electric motoring is too high and there are still too few electric charging stations for electric cars to be anything like mainstream for some time.
"Right now electric cars are still pretty much still a niche market," says Mr Enderle.
However, he adds: "Battery technology is moving like a rocket now; capacitors could fill the performance gap and charging stations are becoming more prevalent."
There are, however, also rumblings in Silicon Valley that Tesla's ability to pay back its government loan has less to do with the public's desire for electric cars than with the company's escalating share price. It was not car sales that enabled Tesla to stump up $465m but the proceeds from a $1bn stock offering this month.
The payback nevertheless confounded many of Tesla's critics. During last year's US presidential debates, the Republican party nominee Mitt Romney attacked the president Barack Obama over his green-jobs investments when he described Tesla as "a loser".
While Mr Romney may have to eat his words following the loan payback, the company still faces a very real threat from big auto and its political allies.
At first glance, it seems odd that a Republican party presidential nominee such as Mr Romney, a member of a breed generally noted for its loyalty to the car industry, should choose to pillory a homegrown US car maker.
But despite the major car makers producing a limited number of electric cars and hybrid vehicles using both petrol and electricity, there is no way that the global industry is ready for a switch from fossil-based fuels to clean electric energy within the foreseeable future.
During the next few years, Tesla will face growing competition from the world's established car makers with their massive research budgets, huge advertising spend and political affiliations. Until there are enough charging stations to enable drivers to use electric cars for ordinary journeys, they will remain a niche product.
If Tesla can manage to grow over the next half-decade despite these hurdles, it stands a chance of emerging as a bona fide car maker not only in the United States but also in the world market.
"If the Republicans don't kill the market in two years, we are now likely to be within a five-year window for this technology to truly jump into the mainstream," says Mr Enderle.