Tesla has unveiled a new 10-year compensation plan for Elon Musk, confirming that the company’s CEO will remain in his current role for the foreseeable future.
Billionaire Musk is not currently receiving a salary from Tesla. Your rewards and financial rewards are completely dependent on Tesla achieving its goals and your success as a business.
As a result, the «Performance Award» detailed in Tesla’s 10-year plan is not new in itself, but the company’s goals are undoubtedly much more ambitious this time around. In particular, Musk will receive the maximum possible compensation only if the company has a market value of $ 650 billion at the end of the decade, about ten times the current figure, and revenue of $ 175 billion.
«Elon will not receive any guaranteed compensation, no salary, no cash or capital bonuses that are simply granted over time,» the company announced. «Instead, Elon’s only compensation will be a 100% performance award, making sure it will only be compensated if Tesla and all its shareholders do extraordinarily well.»
Musk currently owns 13% of Tesla, worth about $ 13 billion. They are not at risk in the set-up, but you will need to achieve a combination of ambitious targets to acquire a further twelve «tranches» of shares, each corresponding to 1% of the company’s remaining current shares. The first target market value is $ 100 billion and it increases by $ 50 billion for each subsequent target. At each stage, Musk must also reach a revenue or profit target.
The Financial Times he commented that these targets are «so high that they almost redefine ‘ambitious'». This conclusion is easy to understand given that Tesla you have had problems with the sufficient production of your Model 3 electric vehicle .
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Musk claimed that the company will produce 20,000 electric vehicles per month in December, but due to «manufacturing defects», it produced only 2,425 in the last quarter of 2017.
The company also never made an annual profit. As we have shown, increasing earnings is not strictly necessary for Musk to personally earn a considerable amount of money, as long as Tesla’s market figures and revenue increase. However, it will be fascinating to see if the CEO can make a profit and get the maximum pay from Tesla.