Tesla Won’t Pay Musk A Salary Until New Targets Are Met

Elon Musk will not receive a salary or cash bonus from Tesla as the company announced that his compensation as CEO is now tied to stock and operational milestones.

Tesla Motors announced the new 10-year CEO Performance Award, saying that their market cap would have to grow to $650 billion (an increase of almost $600 billion) and achieve “important revenue and profitability goals” in order Musk to fully vest in the award.

The new performance award is similar to Musk’s last compensation award which was enabled in 2012, and is divided in 12 tranches. Each one of the tranches will vest only if both market capitalization and operational milestones are met.

Elon Musk was then awarded stock options when he successfully met both market capitalization and operational milestones, including production and developmental targets relating to the Model X and Model 3.

Tesla says that its market capitalization must increase to $100 billion (from roughly $60 billion today) for the first tranche to be vested and must continue to increase in additional $50 billion increments for the remaining 11 tranches.

Apart from Tesla’s CEO, Elon Musk is also the company’s biggest shareholder at the moment, with a 20 percent stake. According to Forbes, Elon Musk’s net worth is about $20 billion.

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  • TheBelltower

    Nice gesture. But he’s a billionaire and is a shareholder. Elon doesn’t give a $h!t about salary.

    • exeptor

      He is a billionaire because of the market capitalization of the company. If it bailout (as many predict) then he is no longer a billionaire. Without any salary he receive no money at all as Tesla is not a profitable company so there might not be any interests paid for this 20% stake.

      • TheBelltower

        Yes, his value from Tesla is through market cap, just like the CEOs of many companies. He was a billionaire from PayPal. I don’t know what he’s worth today, but my point was that he’s certainly not living off of a paycheck.

        • exeptor

          Agree with you.

  • Craig

    I’ve started a GoFundMe page for Mr. Musk to help him buy food and other essentials.

    • Frank Yoster

      Loool

  • Auto

    Well, they have failed every single milestone they have set. My expectations are LOW.

  • smartacus

    oh how sanctimonious of him!

    You know how dependent he is on taxpayers?
    Three of Elon Musk’s companies,
    Tesla Motors, SolarCity, and SpaceX,
    received approximately $4.9 billion
    in funding from the U.S. government.

    And did you know SpaceX was unable to perform
    the static fire test of their new Falcon Heavy rocket
    because of lack of ground support from
    the U.S. Air Force’s s 45th Space Wing and NASA
    due to lack of government assistance since the recent shutdown.

    **what does SpaceX have to do with automotive news???
    well, why do we still get the occasional SpaceX stories on automotive news sites?
    oh yeah, the keep Vanilla Musk in the news.

    • liams92

      Worth noting that Tesla paid back the government loan with interest early. The taxpayer got a worse deal from the 3 Detroit automakers loans.

  • UGH! Another Tesla Story

  • WELL I LEARNED A NEW WORD TODAY, SOUNDS VERY ELEGANT. DON’T KNOW IF I’LL EVER USE IT THO.
    https://www.merriam-webster.com/dictionary/tranche

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