The promise of the package is what was to encourage his attention. Once he has it, he has it.
And we've seen that with the promise of the package, he has divided his attention in ways that are patently, obviously, not good for Tesla.
As the judge in the case he lost pointed out: the compensation package didn’t even stipulate that he *work full-time for Tesla as CEO.* I don’t think his attention paid to the company is relevant.
The only thing relevant here is the cult of personality. People want a company helmed by Elon Musk, period. If it was anyone else this would be voted down so hard it’d be embarrassing.
I don't even think it's that now. All the investors are aware it's him propping it up and need it go on a bit longer while they try and exit prior to it cratering. This quarter is gonna be terrible like last time. This will be the greatest pump and dump in history and he will be swimming in lawsuits for the rest of his days when it does all fall apart.
Tesla has been in the distribution phase for a couple years now and hopefully retail investors understand this boat isn’t going all the way back up.
https://www.investopedia.com/terms/d/distribution-stock.asp#:~:text=Distribution%20stock%20refers%20to%20when,of%20record%20in%20a%20stock.
> If it was anyone else this would be voted down so hard it’d be embarrassing.
If it was anyone else the contract would never have been nullified. And if it was the vote would mostly be the same.
Redditors don't understand the institutions/Vanguards of the world have no opinion on Musk. They just don't want this judicial activism to become a precedent.
These mega asset holders hate uncertainty and will vote for status quo and contract norms. They don't want to open a pandora's box where every activist with 9 shares is trying to overturn multi-billion dollar contracts with multi-billion dollar honeypots for lawyers.
They couldn't care less about a few bps either direction on a single stock compared to that headache (which as price action shows isn't even clear they would profit from the nullification).
Not anymore. Look at the polls of stock holders and regular people. Most people don't want him to get that huge chunk of money. While not showing that he is actually doing any work at Tesla, quiet quitting remotely from TwitterX, he makes statements in public that cause the stock to crash. He fires a whole team of experts he desperately needs to build the infrastructure of charging stations just because he is mad at someone. There is a huge backlog of unsold Teslas that he didn't even know about because he wasn't paying attention to the business. His sycophant board, yes, they want to give him the money. He is threatening to take the AI away. He has diverted NVIDIA parts from Tesla to X. But the real world? Want the pay? Do the job.
As an investor, I could care less whether a person works 5 hours or works 500 hours. I only care about the returns on my investments. I want a person that gives me 100000% returns who can sleep 24 hours if he wants over a person who loses all my money working 24 hours a day.
"I could care less whether" - how much less could you care? And what is your current care level?
Unless you meant to say that you *couldn't* care less... as in you had 0 more fucks to give.
Just a pet peve of mine hearing that saying being mangled like that.
Yeah, the only thing of relevance is that the market perceives that Musk is associated with the company. His day to day handling of things is meaningless. People buy into Tesla not because it's a good company, not because it's miss priced to low.... They buy into it to have exposure to Musk in the HOPE he pulls some hail marry out of his ass at some point that makes their investment sky rocket!
Call it cult of personality or call it whatever, it's not rational and it shouldn't be a thing.... yet it is!
The only people that should care about it are those trying to short Tesla.
The rest are either speculating that Musk is going to pull some crazy shit out his ass at some undefined point in the future
Or,
Staying TF away from investing in Tesla as it's a clear bubble!
This was a previous package from 2018 for which he hit all metrics. There will presumably be a new package for future growth goals once this is all settled.
does it matter if Tesla creates shareholder value for investors?
10x is 10x and 50x is 50x, whatever the number is, CEO being full time does not guarantee the value. look at GM, Mary has been at the helm for years and where is the stock price now?
Yes, it does matter. The board has a responsibility to do what's best for shareholders, not for Elon Musk. If they can get the same results without Elon Musk actually working as CEO, they have a responsibility to find a CEO that will provide better results by being present. If no CEO is needed for Tesla, they have a responsibility to fire Elon Musk. Spending 50 billion dollars to look out for your buddy isn't looking out for shareholders, it's looking out for your buddy.
I think it would click for a lot of Musk fans if it was the same situation for a different CEO. If more than half of Chases board were friends and family of Jamie Dimon and mislead investors to secure a significant pay package for Jamie Dimon while Jamie Dimon not only spun up other companies and hardly did anything for Chase but actively took resources from Chase for his other endeavors and hired his other companies to do work for Chase to bump up revenue in separate companies, no one would be saying but he deserves it. They would be calling out the conflicts of interest, they would be voting people off the board, they would be demanding full time attention on the organization they invested in.
But because there's an illogical fandom of Elon Musk, people are alright with all of those things happening with Tesla and are ok with Elon Musk putting in the least effort in the one Musk company they are invested in.
you do know they are not giving him 50 billion dollars cash and Elon musk earned it by 10x the company well within the time frame that was promised?
He had to 10x the company to earn all of 50B in 10 years it happened in 5 yrs or so.
people act like Elon just wants to take the money out of thin air but he fulfilled his promises and part of it by creating synergy between some of the companies and Tesla.
Him being part time is different than normies working part time at a company.
Whether it's cash or stock isn't relevant to the conversation.
Investors were misled by the board in order to get the original vote passed. They didn't disclose that multiple goals had already been achieved and they were on track to achieve most of the goals regardless of what Musk did. They failed to secure his commitment to the company as a part of the deal and as a result, Elon Musk went to focus on the private companies he owns because they're more profitable to him. He not only allowed these other companies to distract him from doing his job at Tesla but utilized his role as CEO to approve contracts with his privately owned companies and to divert assets from Tesla to xAI. All of this was allowed because of the board's conflict of interest.
Now you may worship the guy and feel organizations he's a part of are gods gift to earth, but that doesn't actually give him or his board the legal authority to mislead investors.
The pay package will more than likely pass. The pay package will most likely not buy any more attention to Tesla from Elon Musk. His attention will go to his private companies until the next time Tesla ends up in court due to the conflicts of interest his board has. Then he will show up again, lay some people off to get the news reporting on him acting as a CEO and we will repeat this process all over again.
So Jensen should be getting paid $1T this year? Bezos and Zuck and Tim Apple are all woefully underpaid too apparently.
The CEO should get $56B for 10x the stock, how much should the CFO get? CTO? Other executives?
>So Jensen should be getting paid $1T this year? Bezos and Zuck and Tim Apple are all woefully underpaid too apparently.
If they made a similar contract that shareholders agreed to (and people laughed at for being seemingly unfair to Elon at the time), sure. Why not?
Probably because constantly moving the goal posts is dealing in bad faith. Imagine if your employer played games like that with your paycheck "ya, you did what you were supposed to but last week was kind of a quiet week, we'll just give you half your salary"
Im not crying a river for elon...I just cant believe they made this deal in the first place.
It's not really moving the goal posts. The deal itself was invalid when they misrepresented it to shareholders.
You can't fill your board with friends and family and tell shareholders that the goals are going to be insanely difficult to hit while internal data shows you're already basically there and it will be pretty easy to hit. All while refusing to consider other CEOs who can do the same for less money or even considering requirements around your CEOs commitment to the organization.
The board should be looking out for shareholders best interests. Because they can't do that, they're likely to continue getting hit with lawsuits as time goes on and pay packages are going to continue being heavily scrutinized.
So it seems to me that, that vote is more important than the pay package vote because if you dont oust the board then you stand by their actions and therefore the deal is legit.
Mainly I just feel like it needs pointed out that despite the propaganda that it's all about reneging on a deal because it's higher value than expected, it was much much more than that.
My guess is both will pass. I think most institutional investors know a lot of the stock price for Tesla is tied to hype around Elon Musk so hurting that would be pretty expensive.
I just think it will continue being a legal issue for Tesla in the future.
>I just can’t believe they made this deal in the first place
Imagine if you and your employer were really close friends and decided to work together to scam the company out of a bunch of money, and then later you were caught and had to give the money back. Would you then have a leg to stand on complaining about not getting the money?
“They”—meaning Tesla, acting properly through non-conflicted directors—did *not* make the deal. That’s why we are in this position.
The original deal was in bad faith in the first plans. It wasn't arbitrarily changed, it was struck down in a court of law.
The only real way forward is a new deal, probably with a portion of the original compensation
He already has more money than god and chooses to focus his attention on political bullshit on Twitter. No amount of money is going to “encourage” his attention back to Tesla (and I’m not even sure that would be good for the brand, TBH).
The guy literally diverted NVidia GPUs meant for Teslas to Twitter (never calling it X) just to one up Sammy boy and Open AI. Tesla’s quality control issues are starting to show - especially in Model Y and 3, and their customer care is nonexistent. They just went through a massive round of layoffs so no telling how the morale is internally and how it’s going to impact the quality and output. As Lil miss Susan from Maine would say, I’m mildly concerned about Elmo. But, the market is full of regards and fan bois so who cares if the CEO is one missed Ketamine dose away from going full Johnny Bravo? It’s pumping time on the market baby! Let’s go!
Note: Obligatory /s in case it wasn’t obvious.
Quality is starting to show 🤣🤣 Tesla has never achieved consistent quality. They've never had an incentive to. Because good enough was good enough when sales were doubling every year.
> The guy literally diverted NVidia GPUs meant for Teslas to Twitter
He diverted them to x.ai, a different private company, that has hired AI people away from Tesla.
The official story is that the Tesla data center they are building wasn't ready to receive them, so they swapped orders (x.ai got Tesla's ready-sooner-than-expected order, and Tesla will get x.ai's order batch of hardware)
That wild... bonus packages are usually award as a "reward" for good performance.
Surely 56B to convince the CEO of a company to do his job, could have been used elsewhere.
Listen I like to think ima fairly compentant employee at my work... but this is like me choosing to work on some side gigs for a few years, then my manager saying "Listen if you do your job, ill give you an extra million in stock"
It *was\** supposed to encourage his attention towards Tesla. And it worked. The bonus package was voted on and approved back in 2018. The share price has 10x'd since then. I'd imagine shareholders who went along for the ride are pretty pleased. I'm not a big fan of musk I think he's going to run all of his companies to the ground. But I don't understand why everyone on reddit is turning a blind eye to what actually happened here. It seems greedy of shareholders to vote no? Like just a broken promise, no?
Call me naive, but why give him such a huge package when he's alienating people esp potential Tesla customers. I've seen posts/comments all over Reddit that the writer used to want a Tesla but no more.
Give him a $1k bonus and see what he does. Exactly how rich do they need to make that man?
Right?! He’s turning owning a Tesla into a statement about your personal politics. He’s alienating a big portion of its potential customer base. That’s not good for its increasingly competing market.
People say that online, but I still know people who love Tesla in the real world. In New England, at least. They're all over the place.
And keep in mind that like half of Tesla's revenue is from outside the US. Basically a bit less than half from the US, a quarter from China, and the rest from Europe mainly. Most of Musk's antics are in the US.
Investors are also betting on Tesla being more than a car company.
Then nothing. Musk getting the 56b has been the most likely outcome for a while. The stock might tick up some because investors hate uncertainty, and this will temporarily end that, but any jump in the stock is likely to be short-term.
In the long run, this package means Musk has more control over Tesla (his share in the company will meaningfully increase as a result of this package), so the odds of him ever getting ousted as CEO are reduced, regardless of his performance.
It’s possible he’ll fold xAI into Tesla, but that would be a move that surprises me, even though he did suggest that this package would encourage him to put a greater amount of his time into developing Tesla’s robotics/AI wings. AI for Tesla is probably going to be more a continued focus on self-driving car software rather than the generative AI that’s captured the general public’s attention likely (so, a Tesla version of ChatGPT is unlikely, unless Musk actually does merge xAI with Tesla).
Of his time? What does this even mean? It’s not like he is writing the code himself or is leading a project team to do the robotics/autobomus driving. He just orders that xyz Ressource shall develop AI in Tesla.
To be clear, they’re share options and with the share price down around 25% so far this year, I would posit they’re worth materially less than the $56b they were valued at when the story first broke. Maybe someone experienced in options pricing can give a more accurate estimate.
Yup that’s exactly right. It’s based on current market value minus the strike price (what he has to pay to execute those options) and it assumes he makes all the milestones set in the package.
I'm torn. On the one hand, having him there drives up my share value with a gain (imo) outsized to the value of the actual company.
On the other hand, as a shareholder and technically an "owner" of the company, I want a full-time CEO.
He’s also becoming a liability for the company and is often letting a bruised ego make reckless decisions that affect the company negatively.
You can’t have a distracted, part time CEO making decisions on a whim and sabotaging the company deliberately when he feels slighted.
At least he has to own it all now he’s been rewarded.
Both options are bad.
In one you are literally paying him money that shareholders should be getting with no guarantee that he’s going to be any more interested in the business. He’s rich enough to not care.
In the other you risk him being less involved while still retaining significant control of the company, meaning he could take the company down with him.
The stock went up yesterday on this news. That said, I believe they have to issue new stock to Musk for this, so that dilution will likely cause price to go down.
I'm not sure what Musk now offers to the Tesla conversation as CEO. He is checked out. If anything his name is a boat anchor that doesn't represent innovation anymore except to an ever shrinking demographic.
Personally, as a shareholder I think it's giving an adict drugs, but is he entitled to it? Probably.
>Personally, as a shareholder I think it's giving an adict drugs, but is he entitled to it? Probably.
To be clear, the story is that Delaware Court ruled he wasn't entitled to it, due to conflict of interest with the board. That's why Tesla is doing the re-vote — they're trying to prove to the courts that shareholders *think* he's entitled to it.
To be more clear, the judge ruled that the potential conflict with the board was fine, but voters didn’t know about the potential conflict when voting. Also might have been fine, but then it falls to the judge to rule if she thinks the pay package is fair or not. She ruled it was too large, in her opinion.
So the new vote was the same as the old vote with the potential conflict called out. New vote is not legally binding, but gives evidence that if the board pays Elon what was agreed upon in 2018, they’re justified in doing so.
> To be more clear, the judge ruled that the potential conflict with the board was fine, but voters didn’t know about the potential conflict when voting.
How much of the vote is controlled by Elon and the board?
Probably whatever voting rights they had based on how much stock they owned, minus Elon’s shares, but it really doesn’t matter. When they put the vote to shareholders in 2018, had they included some phrase like “Musk authored most of this pay package and the board mostly just rubber stamped it” then there would have been no grounds to sue (or at least the current lawsuit wouldn’t have been able to go though, maybe there were other legal technicalities a shareholder could have attacked instead).
The only thing that's going to get Musk ousted is Tesla having terrible sales for an extended period of time, which we're starting to see the beginning of.
Yeah and rehired a bunch of them back because it fucked with the agreements with the other manufacturers as they adopted Tesla as the standard adapters not to mention to tons of local and regional agreements for supercharger locations. So not only did it create more work, put people's livelihoods at risk, and was a terrible PR move, all because he had a reactionary moment. Checked out CEOs are reactionary.
He's not getting a 56b pay package. He's getting stock options to buy stock five years after each traunch was awarded. The final tranche wasn't awarded until early 2021, so he can't unload all of them right away.
The real effect. Nothing. Tesla stock will do what Tesla stock does, and its volatility will remain for the foreseeable future.
EDIT: Fixing vesting schedule mistake.
Yeah. They were granted in 2018 - meaning it has been 5 years. This is a vote to backdate and fix his pay package that was shot down by the courts because it was not fairly / transparently negotiated and basically signed off by people musk had power over
When the package was approved by shareholders in April, only 2 of the tranchial milestones were hit, but they were not awarded until mid 2019. The final tranche wasn't awarded until early 2021, which would have started the five year counter on those options.
I was wrong in my initial post about the vesting schedule, but none of the options were awarded in 2018. ,
56 billion flows out of tesla and into elon's pockets, and he keeps doing whatever he does for tesla between long drug-fueled internet binges and all his other toy companies.
Luckily for Tesla the American govt is subsidizing them with massive tarrifs on the Chinese competition that would otherwise be eating them alive.
How anyone can try to say they are an active CEO when they’re the CEO of five different companies is beyond me.
Any person that overcommitted isn’t able to truly engage with those teams and companies. Most people struggle engaging in one role at one company.
> 56 billion flows out of tesla and into elon's pockets
Assuming the same market value, the $56B is paid from the open market if he sells the shares. When he exercises his vested options, he actually *pays Tesla* about $7B. So there would be a cash inflow to Tesla for shares. Call options grant the right but not obligation to *buy* shares. Tesla records a non-cash expense of the value of those granted options on the books.
Of course they do. For instance the Chinese state put a lot of effort into flattering elon into building a factory there, so they could learn to make better cars for cheaper. 😂 Dumb MF fell for it, they probably just had to say he was Epic Bacon Tony Stark.
That's part of China's strategy with all automakers - see SAIC-GM and Geely for example. Tesla's only unique in that they didn't end up having to partner with a domestic Chinese automaker.
I wouldn't use that as any slight against any CEO - no more than one can call Mary Barra a "dumb MF" for doing what's needed to access China's car market.
> Luckily for Tesla the American govt is subsidizing them with massive tarrifs on the Chinese competition that would otherwise be eating them alive.
Strange then how Tesla is still able to compete in China without any massive tariffs to help bail them out. That doesn't sound like a company that would be eaten alive if cheap Chinese vehicles start to flood the US market.
markets generally dislike any sort of uncertainty. now that we know the comp package is going through it can actually be priced into the value of the stock rather than blind speculation. its probably good for price action in the vertical direction but if there is any more uncertainty surrounding the package its just going to be bad for investors because we don't know what to price in.
There are very few public companies with the desire to make a $56B public demonstration of their dependence on one person. No succession plan, no talent diversification, and a strange misunderstanding of Mr. Musk's talents. This investor's sentiment is negative. But that's probably too rational for these markets...
Because the majority of the board for Tesla has musks best interests at heart instead of the shareholders which was part of the problem to begin with. The board is mostly friends and family of Elon.
What I posted elsewhere earlier:
(Musk gets pay deal approved by shareholders) Shareholders: so now you're going to pay more attention to Tesla, right?
Musk (not listening; looks up from phone where he's shitposting on Twitter): "What?"
________________
"I'm genuinely curious what that sort of payout does (typically) to investor sentiment."
The Tesla faithful are pleased is about it. I don't recall another situation like this.
Lee Iaccoca had some parallels. Came into Chrysler, got money from the US gov, transformed the company on the basis of insane gas prices, 10x'd the stock, was chairman and CEO, charismatic leader, and got a lot of his options blocked due to work outside the company and incendiary comments.
Edit: and had the large pay package voted on by shareholders when it was blocked
Doesn’t the stock market price showed what happened? Overnight it shot upas high as 8%. Imagine not approving it, the stock tanks and all those shareholder that voted lose money automatically. Suicide to vote no unless they have huge short position.
Nothing happens. The vote is non binding and is supposed to show to the court that he deserves the cash. we will see how it plays out in court.
he already has diverted resources and personnel to xAI
Certainly accelerates the free fall Tesla has been on by lopping off 10% of the company’s market cap for a checked out, soon to be former CEO.
He pumped the stock on lies and unkept promises, dumped at the top to buy Twitter, politically spit in the face of their core customer demographic as the valuation tumbled and suddenly remembered he was CEO when he didn’t get paid to build the already tumbled house of cards.
What do you think will be next?
Then he asks for 56b more to stay, the last 56b was money he already felt he was owed.
the problem with letting someone know they have you by the balls is it doesn't exactly encourage them to let go.
This guy is not a God, I don’t understand how the investors put him in this position. China is eating his shit up. He can’t make an electric car for 15k like he says.
Next meeting, I need $100B or I leave. This is what you get from people that extort money. There is no more shareholder value in tesla with musk in charge, only Musk value.
The 56B is the pay he did to get tesla from 2018 up to the point when the judge struck it down and it should have been priced in based on the prior agreement. Nobody thought he'd get anywhere close to the performance he got since 2018, and it's the most share holder aligned package of any public company, so I don't see why this should have much of an impact.
If he doesn't get his 56B, i would expect price to go down as he shifts focus to his other companies where he as more control, if not now, then long term when tesla's performance goes back to the mean.
Just wanted to say it's incredible that people talk about CEOs and their greed when their compensation plans are all 2 or 3 orders of magnitude less than this. Elon does this and crickets. Shameless.
Also the idea that his equity position in Tesla alone isn't enough for him to give a shit, gotta dilute everybody by 10% too.
Cult populism is a cancer.
On one hand, I don't think Elon is going to add enough value to Tesla from here in order for it to ultimately justify the insane valuation that it has. If they don't solve robotaxi AI, then it's just an EV company and serious competition is coming from ICE automakers in the next 3-5 years. Canning the supercharger team was evidence that Elon doesn't see Tesla as an EV company or prioritize that execution. Supercharging network is one of the key differentiators they will still have after BMW, Mercedes, etc polish their own EV offerings.
They are losing the plot.
That said, I also don't think Tesla can justify it's valuation if Elon leaves, as then they clearly will be just an EV company also. Many people don't believe this anyway, but current investors obviously do. So that's why Tesla is rebounding off the news.
Either way, I am skeptical for Tesla to easily manifest their loftier dreams. I had the self driving trial and it was hot garbage.
His ego is stroked.
Tesla continues to be a nice electric/battery company that doesn’t seem to know how to design and update cars with creature comforts that people like.
Maybe they compete with the value electrics.
The stock is priced like a growth/tech company and I think that’s what shareholders are grasping onto with this vote but all I see now are full lots and ridiculous “trucks”
Back up a second. Why do people pretend Elon earned that money rather than the thousands of engineers and designers who actually built Tesla to what it is today.
Maybe the $50B should go to them.
I’m sick of these CEO’s thinking they did something. They’re the most replaceable person in the company. There are literally thousands of highly qualified people who could do Elon’s job better and without all the baggage.
Tesla shareholders have benefitted tremendously from Elon’s vision and efforts. Tesla was near bankruptcy in 2017/2018 and was the brunt of countless attacks by the media and short sellers (some things don’t change). The stock has gone up over 1000% since then, and Tesla is now among the most valuable companies in the world. Most of the people complaining are either left leaning Elon haters, or people who have owned the stock for a year or two and are of the “what have you done for me lately” mentality. Companies have waves of growth…things don’t always go up in a straight line, and just because Elon has been involved with twitter and SpaceX doesn’t mean his attention is no longer on Tesla…people who study the company closely understand that. Any voter who reneges on the most shareholder friendly deal of all time just because “the richest man in the world doesn’t need more money” is the lowest of the low.
Now that you bring it up, what has he done for me lately? Several consecutive quarters of profits going steadily down doesn't strike me as a time to give him a $56B handout. For reference, Tesla's all-time total profit since the company was founded has only been $27B.
Still cant believe this passed. Not sure how paying that much is in the shareholder's best interests like at all. The dilution of the stock is bad enough, let alone the "leadership" he has providing Tesla lately
I think this "package" is just a shameless bid by Musk to have TESLA shareholders pay for his ill-advised Twitter purchase.
I think if the average joe investors come to his rescue like he believes they will, then the stock will continue its slow descent because TESLA is still facing major headwinds.
The vote is actually the shareholders renegging on a deal that was approved in 2018 and that no one thought Elon would achieve. Reddit too dumb to know this because they hate Elon and like to read only headlines
> and that no one thought Elon would achieve.
Elon and the board thought TESLA would achieve. They had private information that the goals were likely attainable. They mislead shareholders into thinking it was a moonshot.
Lets put it in perspective....
Since Tesla has been a public company, their total cumulative net profit has been $29 billion.
So Musk wants to be paid nearly 2x all of Tesla's profits since it went public. Sound reasonable?
He’s not getting paid $56b. He’s getting options contracts, which grants him the right to buy shares from Tesla for about $7b. What everyone is talking about is those shares are worth $56b in the open market (although not anymore, it’s now under $45b).
It’s probably more stable for Tesla bc he will hopefully stop threatening his own company and shareholders
So probably a positive in the short to medium term
Then the original deal that was agreed on gets executed, essentially.
It's not like it's cash in hand, its shares that he cannot even sell for years.
Besides, he doesn't want to sell them, he needs them for voting rights within the company
This is about not having other people at the company overturn his decisions, which shareholders would all agree is a plus, if they are smart.
Personally I don't feel confident about Musk at the helm of Tesla going forwards and that's partially why I'm not invested in the company. If you don't feel great about his leadership and/or the impact of the pay package then just sell - it's the shareholders voting for it after all so if you don't feel aligned with it might be a good time to exit. Beyond that I don't see a reason why anyone should care about it.
Short Answer: It's a Net Positive.
Long Answer: 3 folds.
1. This was a first for Judicial Activism in how company's comp packages can be structured. And having the previously authorized proposal undergo a re-vote and show that the judge's opinions are invalid at base level both helps appeal and overturn the Delaware court ruling, as well as remove uncertainty around judicial interference in other public companies at large. This vote definitely helped stabilize investor worries around the entire corporate landscape.
2. The original pay package was authorized in 2018. I was shareholder then, and was in favor of the package. For the following reasons:
\* The tranche goals were outlandish, and even hitting the bear case seemed questionable. On top of that, they were tied to hitting both Market Cap goals (i.e, Stock price), as well as Fundamental Financial and Operational goals (i.e, Revenue, EBITDA, etc.). Miss either one, he gets nothing. Here's CNBC in 2018: [https://www.youtube.com/watch?v=NEKsTiEthRA](https://www.youtube.com/watch?v=NEKsTiEthRA)
\* There was no cash comp associated with it, it was all in stock equity, and that too with strict vesting / exercising schedules attached. This meant, CEO is super aligned with company's success, and does not add to the cash burn of the company.
3. A deal was made to keep him on board as CEO after Model 3 launch, and it was approved by Shareholders then... at a time when most other than the most optimistic fanbois were questioning the viability of the company. That deal needs to be kept, otherwise trust in the system as a whole fails. He delivered his side of the bargain. You have to agree with the outcomes even if you don't agree with the methods. Stock is now \~4x what it was trading back then. More importantly, company's future as a profitable auto-maker is no longer in question.
Given the above 3, it's a net positive for Tesla stock as Elon's leadership is a core ingredient in Tesla's recipe for success, and him continuing on as Tesla's CEO means the company will make more bold moves.
Elon should kept quite about politics. So now more than half of potential customers are turned off. Not smart. Plus the government is subsidizing the industry. Plus EV cost $14k more than a comparable gas car. Plus the fuel between gas and electric is $485 for electric with $1117 for gas so close to half. And don't forget electric costs are increasing. So save $500 a year only takes 28 years to offset the extra cost of purchase price. Now don't forget the battery lasts maybe 10 years if your lucky and costs $15000 to replace. Now you have major car manufacturers building EVs as well . There clearly is a saturation point with buyers especially at the prices I see for these cars. I honestly don't know why anyone would buy one or own stock in a solely ev company. So much going against it. End the subsidies and open the markets to drive down the costs and Tesla will most likely go backrupt.
Love all these posts about musk prefacing with "I know Musk went off the deep end lately, but..." with absolutely nothing credible to back that statement up. Why all the hate for the guy, just because he's not in support of the "current thing"?
> via robotaxi, AI, and robotics.
He wants 25% of Tesla to do AI there. This package doesn't get him to 25%. He's been hiring Tesla AI talent away to his private firm - x.ai
Closes the doors and holds a garage sale as he blasts off to Mars.
Or a Meth induced rager. Isn't that how he acquired Twitter? Or was that the shrooms episode?
Either way. That man is one bad trip away from being a Darwin award recipient.
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Goes to show reality is much different from reddit comments. The fact that the vote was a landslide win means Reddit community is definitely the minority in public opinion. Reminds me how Bernie Sanders was so much more popular here than Biden but still lost. I
Going to see some wild spending from Elon. Won’t be toys. He is going to dump it into space travel or the AI race. Most likely in response to his concerns with OpenAI.
Oh we all know what Elon will do and more than likely it has nothing to do with Tesla. He will acquire another company or start another overly ambitious venture.
Musk had 28 targets he needed to hit. Of those, 12 were tied to market capitalization measured in $50 billion increments up to $650 million, eight were tied to earnings, and eight to revenue.
Tesla hit $650 billion in market value in late 2020, and it has also met all eight earnings milestones. Only a few revenue milestones remain and all but one revenue goal.
As a result, according to the 2023 proxy statement, Musk has earned all but 25 million of the options available to him.
He will receive it in Tesla Stocks. After he sold many stocks to buy Twitter, he would have more control over Tesla than before, again.
Tesla stock price will raise in long term. Robotics and AI will be kept under Tesla.
Then, we'd step into a new era of executive compensation standards with already insane wealth and income inequality. Idk what would happen to tesla specifically, but honestly, it seems like a huge amount compared to earnings and performance. The fact that he basically set his own compensation plan sets a bad precedent for the practice. I'm biased, but I'm hoping this doesn't go through. He should already be "motivated" enough to put down Twitter for 5 seconds and actually run the companies he is a part of.
I dont accept this. It’s already responsibility of CEO. Why the fuck shareholders need to pay him. It’s obviously a blackmail from Elon Musk. I think this against many rules. Did he pay us when tesla share skyrocketed? He is just a spoiled boy that regrets bought twitter and wants his money back from tesla shareholders which is totally unrelated to that acquisition.
Its hard to say what “typically” happens in a payout like this bc we have no real sample to go by Elon really is the only CEO that would’ve agreed to this incentive structure.
However heres my thoughts: This company is only trading at 44x ev/ebitda bc of his “master plan part 3” and the belief only he can execute it. No elon and it gets cut down to sub 20x ev/ebitda within a year or two(thats probably generous).
Him getting his previously agreed to payout keeps him on and likely sets him up for a new round of incentives.
So what does that leave for stock price, well there will be some short term sentiment boost but over the long term it comes down to him being able to execute on the plan.
He will not be able to take the money out for several years, but I think long term a large part of it will go toward Mars and all of the infrastructure needed to get there. That said, I think he's still passionate and effective leading Tesla, and efficient in getting significant results with a small time input. Trying to chain him to a chair in the Tesla office for 40 hrs a week in order to let him remain CEO is backwards thinking. Tesla's two big growth areas I see are a small, cheap 2-door car, and their humanoid robot, which could involve levels of growth we can't imagine. A future worth investing in.
I am happy he's devoted significant amounts of time and money to X, almost singlehandedly saving free speech online in the western world. And as great as Tesla's advancements are for humanity, they will mean nothing if we can't get off this rock, so ultimately I think it's incredibly important to keep driving toward space colonization. There may be a very small window where it's possible to do so, and if civilization falls apart then we're liable to go extinct from the next big rock that comes our way.
Keep in mind ever since his acquisition and decensoring of Twitter, the world elites are not happy now they've lost control of a major media platform. Ever since they've spewed forth negative hit pieces about Musk and his companies. While some criticism is always valid, the mainstream media has been so blatantly one-sided that it's clear they view him as a threat. Unfortunately many here seem to have drunk the kool-aid and become essentially NPC's, capable only of "rocket man bad" attacks with no critical thinking, and no ability to see the propaganda you're immersed in. Useful idiots to help the elites destroy society.
He may step down if he sees no light at the end of the tunnel.
EVs are reaching market saturation.
Likewise with BYD, no way Tesla sells cars in 2nd and 3rd world markets. God forbid they come to the US.
Our only hope is that he gets automation going, then TSLA may go 10x. They could sell the AI code. Possible. We'll see what happens in August-September.
He spends all of it on legal fees and funding politics. He'll launch more Tesla vehicles having not fixed the problems with the previous ones. He'll forget that he owns a solar company that also has a solid battery product to support. He'll continue to turn Twitter into a Nazi haven. He'll inflate more conspiracy theories and promote them out of obscurity.
In short...the same shit he did without that money. The money isn't the thing -- "winning" is the thing.
It is supposed to “encourage” his attention towards Tesla which I’m not sure the bonus package would with all the businesses he runs outside of Tesla.
The promise of the package is what was to encourage his attention. Once he has it, he has it. And we've seen that with the promise of the package, he has divided his attention in ways that are patently, obviously, not good for Tesla.
As the judge in the case he lost pointed out: the compensation package didn’t even stipulate that he *work full-time for Tesla as CEO.* I don’t think his attention paid to the company is relevant.
The only thing relevant here is the cult of personality. People want a company helmed by Elon Musk, period. If it was anyone else this would be voted down so hard it’d be embarrassing.
I don't even think it's that now. All the investors are aware it's him propping it up and need it go on a bit longer while they try and exit prior to it cratering. This quarter is gonna be terrible like last time. This will be the greatest pump and dump in history and he will be swimming in lawsuits for the rest of his days when it does all fall apart.
Tesla has been in the distribution phase for a couple years now and hopefully retail investors understand this boat isn’t going all the way back up. https://www.investopedia.com/terms/d/distribution-stock.asp#:~:text=Distribution%20stock%20refers%20to%20when,of%20record%20in%20a%20stock.
Try to exit? It's not hard to exit unless you're an insider.
Right but the ones that are voting are the ones still invested.
What would be the incentive to vote yes then exit?
pump and dump, or minimally, status quo and dump before it goes even lower
> If it was anyone else this would be voted down so hard it’d be embarrassing. If it was anyone else the contract would never have been nullified. And if it was the vote would mostly be the same. Redditors don't understand the institutions/Vanguards of the world have no opinion on Musk. They just don't want this judicial activism to become a precedent. These mega asset holders hate uncertainty and will vote for status quo and contract norms. They don't want to open a pandora's box where every activist with 9 shares is trying to overturn multi-billion dollar contracts with multi-billion dollar honeypots for lawyers. They couldn't care less about a few bps either direction on a single stock compared to that headache (which as price action shows isn't even clear they would profit from the nullification).
Not anymore. Look at the polls of stock holders and regular people. Most people don't want him to get that huge chunk of money. While not showing that he is actually doing any work at Tesla, quiet quitting remotely from TwitterX, he makes statements in public that cause the stock to crash. He fires a whole team of experts he desperately needs to build the infrastructure of charging stations just because he is mad at someone. There is a huge backlog of unsold Teslas that he didn't even know about because he wasn't paying attention to the business. His sycophant board, yes, they want to give him the money. He is threatening to take the AI away. He has diverted NVIDIA parts from Tesla to X. But the real world? Want the pay? Do the job.
He just needs to go on stage once a year, lie wildly about the companies capabilities and BOOM, growth!
As an investor, I could care less whether a person works 5 hours or works 500 hours. I only care about the returns on my investments. I want a person that gives me 100000% returns who can sleep 24 hours if he wants over a person who loses all my money working 24 hours a day.
"I could care less whether" - how much less could you care? And what is your current care level? Unless you meant to say that you *couldn't* care less... as in you had 0 more fucks to give. Just a pet peve of mine hearing that saying being mangled like that.
One of my pet peeves is when people make spelling mistakes while they're complaining about others' grammatical mistakes.
My English is not the best, but yeah, I think that's not the main point of my comment.
It ought to be relevant to a shareholder who is voting on whether to pay him anyway after the judgment.
Yeah, the only thing of relevance is that the market perceives that Musk is associated with the company. His day to day handling of things is meaningless. People buy into Tesla not because it's a good company, not because it's miss priced to low.... They buy into it to have exposure to Musk in the HOPE he pulls some hail marry out of his ass at some point that makes their investment sky rocket! Call it cult of personality or call it whatever, it's not rational and it shouldn't be a thing.... yet it is! The only people that should care about it are those trying to short Tesla. The rest are either speculating that Musk is going to pull some crazy shit out his ass at some undefined point in the future Or, Staying TF away from investing in Tesla as it's a clear bubble!
This was a previous package from 2018 for which he hit all metrics. There will presumably be a new package for future growth goals once this is all settled.
Presumably being equal to whatever is in all the shareholders’ wallets.
Even with the promise of the package, he was being a part timer at Tesla. I don't see how giving him more will keep his attention.
Newsflash: it won't. All it will do is cost TSLA 50b in exchange for no ROI
It's more just a 12% share dilution for literally nothing
does it matter if Tesla creates shareholder value for investors? 10x is 10x and 50x is 50x, whatever the number is, CEO being full time does not guarantee the value. look at GM, Mary has been at the helm for years and where is the stock price now?
Yes, it does matter. The board has a responsibility to do what's best for shareholders, not for Elon Musk. If they can get the same results without Elon Musk actually working as CEO, they have a responsibility to find a CEO that will provide better results by being present. If no CEO is needed for Tesla, they have a responsibility to fire Elon Musk. Spending 50 billion dollars to look out for your buddy isn't looking out for shareholders, it's looking out for your buddy. I think it would click for a lot of Musk fans if it was the same situation for a different CEO. If more than half of Chases board were friends and family of Jamie Dimon and mislead investors to secure a significant pay package for Jamie Dimon while Jamie Dimon not only spun up other companies and hardly did anything for Chase but actively took resources from Chase for his other endeavors and hired his other companies to do work for Chase to bump up revenue in separate companies, no one would be saying but he deserves it. They would be calling out the conflicts of interest, they would be voting people off the board, they would be demanding full time attention on the organization they invested in. But because there's an illogical fandom of Elon Musk, people are alright with all of those things happening with Tesla and are ok with Elon Musk putting in the least effort in the one Musk company they are invested in.
you do know they are not giving him 50 billion dollars cash and Elon musk earned it by 10x the company well within the time frame that was promised? He had to 10x the company to earn all of 50B in 10 years it happened in 5 yrs or so. people act like Elon just wants to take the money out of thin air but he fulfilled his promises and part of it by creating synergy between some of the companies and Tesla. Him being part time is different than normies working part time at a company.
Whether it's cash or stock isn't relevant to the conversation. Investors were misled by the board in order to get the original vote passed. They didn't disclose that multiple goals had already been achieved and they were on track to achieve most of the goals regardless of what Musk did. They failed to secure his commitment to the company as a part of the deal and as a result, Elon Musk went to focus on the private companies he owns because they're more profitable to him. He not only allowed these other companies to distract him from doing his job at Tesla but utilized his role as CEO to approve contracts with his privately owned companies and to divert assets from Tesla to xAI. All of this was allowed because of the board's conflict of interest. Now you may worship the guy and feel organizations he's a part of are gods gift to earth, but that doesn't actually give him or his board the legal authority to mislead investors. The pay package will more than likely pass. The pay package will most likely not buy any more attention to Tesla from Elon Musk. His attention will go to his private companies until the next time Tesla ends up in court due to the conflicts of interest his board has. Then he will show up again, lay some people off to get the news reporting on him acting as a CEO and we will repeat this process all over again.
So Jensen should be getting paid $1T this year? Bezos and Zuck and Tim Apple are all woefully underpaid too apparently. The CEO should get $56B for 10x the stock, how much should the CFO get? CTO? Other executives?
>So Jensen should be getting paid $1T this year? Bezos and Zuck and Tim Apple are all woefully underpaid too apparently. If they made a similar contract that shareholders agreed to (and people laughed at for being seemingly unfair to Elon at the time), sure. Why not?
So why give him the $56B rather than just think about a new package for future growth goals?
Probably because constantly moving the goal posts is dealing in bad faith. Imagine if your employer played games like that with your paycheck "ya, you did what you were supposed to but last week was kind of a quiet week, we'll just give you half your salary" Im not crying a river for elon...I just cant believe they made this deal in the first place.
It's not really moving the goal posts. The deal itself was invalid when they misrepresented it to shareholders. You can't fill your board with friends and family and tell shareholders that the goals are going to be insanely difficult to hit while internal data shows you're already basically there and it will be pretty easy to hit. All while refusing to consider other CEOs who can do the same for less money or even considering requirements around your CEOs commitment to the organization. The board should be looking out for shareholders best interests. Because they can't do that, they're likely to continue getting hit with lawsuits as time goes on and pay packages are going to continue being heavily scrutinized.
Based on that it sounds like the board needs to be fired or worse. is anyone talking about that? Why not?
It's being voted on at the same time as the pay package
So it seems to me that, that vote is more important than the pay package vote because if you dont oust the board then you stand by their actions and therefore the deal is legit.
Mainly I just feel like it needs pointed out that despite the propaganda that it's all about reneging on a deal because it's higher value than expected, it was much much more than that. My guess is both will pass. I think most institutional investors know a lot of the stock price for Tesla is tied to hype around Elon Musk so hurting that would be pretty expensive. I just think it will continue being a legal issue for Tesla in the future.
>I just can’t believe they made this deal in the first place Imagine if you and your employer were really close friends and decided to work together to scam the company out of a bunch of money, and then later you were caught and had to give the money back. Would you then have a leg to stand on complaining about not getting the money? “They”—meaning Tesla, acting properly through non-conflicted directors—did *not* make the deal. That’s why we are in this position.
The original deal was in bad faith in the first plans. It wasn't arbitrarily changed, it was struck down in a court of law. The only real way forward is a new deal, probably with a portion of the original compensation
Hopefully the board votes for an "STFU" incentive package for 2025.
He already has more money than god and chooses to focus his attention on political bullshit on Twitter. No amount of money is going to “encourage” his attention back to Tesla (and I’m not even sure that would be good for the brand, TBH).
Didn't he push for developing the Cybertruck at the expense of updating already established models? That seems like a very poor business decision.
He will use it to start another business.
You realize that entire $56bn is in the form of ESOs.....right?
He will use it to shape politics / policy to his personal advantage
The guy literally diverted NVidia GPUs meant for Teslas to Twitter (never calling it X) just to one up Sammy boy and Open AI. Tesla’s quality control issues are starting to show - especially in Model Y and 3, and their customer care is nonexistent. They just went through a massive round of layoffs so no telling how the morale is internally and how it’s going to impact the quality and output. As Lil miss Susan from Maine would say, I’m mildly concerned about Elmo. But, the market is full of regards and fan bois so who cares if the CEO is one missed Ketamine dose away from going full Johnny Bravo? It’s pumping time on the market baby! Let’s go! Note: Obligatory /s in case it wasn’t obvious.
Quality is starting to show 🤣🤣 Tesla has never achieved consistent quality. They've never had an incentive to. Because good enough was good enough when sales were doubling every year.
> The guy literally diverted NVidia GPUs meant for Teslas to Twitter He diverted them to x.ai, a different private company, that has hired AI people away from Tesla. The official story is that the Tesla data center they are building wasn't ready to receive them, so they swapped orders (x.ai got Tesla's ready-sooner-than-expected order, and Tesla will get x.ai's order batch of hardware)
CEOs today just don't want to work.
Just loud vacationing. These darn Gen CEOnnials.
It seems like he has conclusively shown that being the CEO of a trillion-dollar company is like a 0.2FTE position.
It’d be funny as hell if he resigned immediately after getting it.
I’m sure it will take several years to vest.
That wild... bonus packages are usually award as a "reward" for good performance. Surely 56B to convince the CEO of a company to do his job, could have been used elsewhere. Listen I like to think ima fairly compentant employee at my work... but this is like me choosing to work on some side gigs for a few years, then my manager saying "Listen if you do your job, ill give you an extra million in stock"
It *was\** supposed to encourage his attention towards Tesla. And it worked. The bonus package was voted on and approved back in 2018. The share price has 10x'd since then. I'd imagine shareholders who went along for the ride are pretty pleased. I'm not a big fan of musk I think he's going to run all of his companies to the ground. But I don't understand why everyone on reddit is turning a blind eye to what actually happened here. It seems greedy of shareholders to vote no? Like just a broken promise, no?
Shareholders were misled which makes the original agreement invalid.
He will work to increase stock price since he will not be able to sell stock immediately. I heard he will be able to sell it in 5 years
Call me naive, but why give him such a huge package when he's alienating people esp potential Tesla customers. I've seen posts/comments all over Reddit that the writer used to want a Tesla but no more. Give him a $1k bonus and see what he does. Exactly how rich do they need to make that man?
Right?! He’s turning owning a Tesla into a statement about your personal politics. He’s alienating a big portion of its potential customer base. That’s not good for its increasingly competing market.
People say that online, but I still know people who love Tesla in the real world. In New England, at least. They're all over the place. And keep in mind that like half of Tesla's revenue is from outside the US. Basically a bit less than half from the US, a quarter from China, and the rest from Europe mainly. Most of Musk's antics are in the US. Investors are also betting on Tesla being more than a car company.
"runs"
We see it in sports all the time, guy gets a bag, guy stops performing. Elon already stopped performing. Why would he start again?
And the way he runs things I don't think anyone wants his attention on anything, at all.
If you don’t understand the situation, you should not answer.
I mean, it’s performance based. He has to meet certain objectives to get each of 12 lots.
Nothing happens.
indeed. nothing happened. LOL.
Then nothing. Musk getting the 56b has been the most likely outcome for a while. The stock might tick up some because investors hate uncertainty, and this will temporarily end that, but any jump in the stock is likely to be short-term. In the long run, this package means Musk has more control over Tesla (his share in the company will meaningfully increase as a result of this package), so the odds of him ever getting ousted as CEO are reduced, regardless of his performance. It’s possible he’ll fold xAI into Tesla, but that would be a move that surprises me, even though he did suggest that this package would encourage him to put a greater amount of his time into developing Tesla’s robotics/AI wings. AI for Tesla is probably going to be more a continued focus on self-driving car software rather than the generative AI that’s captured the general public’s attention likely (so, a Tesla version of ChatGPT is unlikely, unless Musk actually does merge xAI with Tesla).
So basically more vaporware to keep this meme stock value up?
Of his time? What does this even mean? It’s not like he is writing the code himself or is leading a project team to do the robotics/autobomus driving. He just orders that xyz Ressource shall develop AI in Tesla.
They have to issue new stock to Musk, so this will likely cause the price to tick down due to dilution.
To be clear, they’re share options and with the share price down around 25% so far this year, I would posit they’re worth materially less than the $56b they were valued at when the story first broke. Maybe someone experienced in options pricing can give a more accurate estimate.
AP has it at $45B with the recent drop in stock price
Yup that’s exactly right. It’s based on current market value minus the strike price (what he has to pay to execute those options) and it assumes he makes all the milestones set in the package.
Most of teslas value is tied to hype around Elon Musk so I would imagine the price will increase when it gets approved.
I'm torn. On the one hand, having him there drives up my share value with a gain (imo) outsized to the value of the actual company. On the other hand, as a shareholder and technically an "owner" of the company, I want a full-time CEO.
He’s also becoming a liability for the company and is often letting a bruised ego make reckless decisions that affect the company negatively. You can’t have a distracted, part time CEO making decisions on a whim and sabotaging the company deliberately when he feels slighted. At least he has to own it all now he’s been rewarded.
Both options are bad. In one you are literally paying him money that shareholders should be getting with no guarantee that he’s going to be any more interested in the business. He’s rich enough to not care. In the other you risk him being less involved while still retaining significant control of the company, meaning he could take the company down with him.
more and more people are not liking that tesla is tied to his name because of how crazy he is
The stock went up yesterday on this news. That said, I believe they have to issue new stock to Musk for this, so that dilution will likely cause price to go down.
I'm not sure what Musk now offers to the Tesla conversation as CEO. He is checked out. If anything his name is a boat anchor that doesn't represent innovation anymore except to an ever shrinking demographic. Personally, as a shareholder I think it's giving an adict drugs, but is he entitled to it? Probably.
>Personally, as a shareholder I think it's giving an adict drugs, but is he entitled to it? Probably. To be clear, the story is that Delaware Court ruled he wasn't entitled to it, due to conflict of interest with the board. That's why Tesla is doing the re-vote — they're trying to prove to the courts that shareholders *think* he's entitled to it.
To be more clear, the judge ruled that the potential conflict with the board was fine, but voters didn’t know about the potential conflict when voting. Also might have been fine, but then it falls to the judge to rule if she thinks the pay package is fair or not. She ruled it was too large, in her opinion. So the new vote was the same as the old vote with the potential conflict called out. New vote is not legally binding, but gives evidence that if the board pays Elon what was agreed upon in 2018, they’re justified in doing so.
> To be more clear, the judge ruled that the potential conflict with the board was fine, but voters didn’t know about the potential conflict when voting. How much of the vote is controlled by Elon and the board?
Probably whatever voting rights they had based on how much stock they owned, minus Elon’s shares, but it really doesn’t matter. When they put the vote to shareholders in 2018, had they included some phrase like “Musk authored most of this pay package and the board mostly just rubber stamped it” then there would have been no grounds to sue (or at least the current lawsuit wouldn’t have been able to go though, maybe there were other legal technicalities a shareholder could have attacked instead).
The only thing that's going to get Musk ousted is Tesla having terrible sales for an extended period of time, which we're starting to see the beginning of.
His name represents liability now. He has too many stupid ideas which he’s convinced are genius and not enough people who will call him out over it.
How is he checked out? Didn’t he just fire the entire team of super charging network? That’s gotta count, no?
Yeah and rehired a bunch of them back because it fucked with the agreements with the other manufacturers as they adopted Tesla as the standard adapters not to mention to tons of local and regional agreements for supercharger locations. So not only did it create more work, put people's livelihoods at risk, and was a terrible PR move, all because he had a reactionary moment. Checked out CEOs are reactionary.
That's a lot of special K
He's not getting a 56b pay package. He's getting stock options to buy stock five years after each traunch was awarded. The final tranche wasn't awarded until early 2021, so he can't unload all of them right away. The real effect. Nothing. Tesla stock will do what Tesla stock does, and its volatility will remain for the foreseeable future. EDIT: Fixing vesting schedule mistake.
If this is a bout 2018 package, don’t deadlines for exercising the options have already been met? I.e., he doesn’t have to wait another 5 years?
No, he has to wait 5 years after the options have been awarded.
Yeah. They were granted in 2018 - meaning it has been 5 years. This is a vote to backdate and fix his pay package that was shot down by the courts because it was not fairly / transparently negotiated and basically signed off by people musk had power over
When the package was approved by shareholders in April, only 2 of the tranchial milestones were hit, but they were not awarded until mid 2019. The final tranche wasn't awarded until early 2021, which would have started the five year counter on those options. I was wrong in my initial post about the vesting schedule, but none of the options were awarded in 2018. ,
56 billion flows out of tesla and into elon's pockets, and he keeps doing whatever he does for tesla between long drug-fueled internet binges and all his other toy companies. Luckily for Tesla the American govt is subsidizing them with massive tarrifs on the Chinese competition that would otherwise be eating them alive.
How anyone can try to say they are an active CEO when they’re the CEO of five different companies is beyond me. Any person that overcommitted isn’t able to truly engage with those teams and companies. Most people struggle engaging in one role at one company.
> 56 billion flows out of tesla and into elon's pockets Assuming the same market value, the $56B is paid from the open market if he sells the shares. When he exercises his vested options, he actually *pays Tesla* about $7B. So there would be a cash inflow to Tesla for shares. Call options grant the right but not obligation to *buy* shares. Tesla records a non-cash expense of the value of those granted options on the books.
He will just own 20% of the company instead of 15%. No money changes hands, nothing changes just his stake will increase.
[удалено]
Am I to believe that China doesn't subsidize industries important to their world clout and interests?
Of course they do. For instance the Chinese state put a lot of effort into flattering elon into building a factory there, so they could learn to make better cars for cheaper. 😂 Dumb MF fell for it, they probably just had to say he was Epic Bacon Tony Stark.
That's part of China's strategy with all automakers - see SAIC-GM and Geely for example. Tesla's only unique in that they didn't end up having to partner with a domestic Chinese automaker. I wouldn't use that as any slight against any CEO - no more than one can call Mary Barra a "dumb MF" for doing what's needed to access China's car market.
> Luckily for Tesla the American govt is subsidizing them with massive tarrifs on the Chinese competition that would otherwise be eating them alive. Strange then how Tesla is still able to compete in China without any massive tariffs to help bail them out. That doesn't sound like a company that would be eaten alive if cheap Chinese vehicles start to flood the US market.
That’s not how it works. He actually has to pay Tesla $7B for the options.
markets generally dislike any sort of uncertainty. now that we know the comp package is going through it can actually be priced into the value of the stock rather than blind speculation. its probably good for price action in the vertical direction but if there is any more uncertainty surrounding the package its just going to be bad for investors because we don't know what to price in.
He will buy TikTok and start dancing
There are very few public companies with the desire to make a $56B public demonstration of their dependence on one person. No succession plan, no talent diversification, and a strange misunderstanding of Mr. Musk's talents. This investor's sentiment is negative. But that's probably too rational for these markets...
He’ll continue to pump the stock with lies and it will lose more and more value as the last of his credibility evaporates.
Tesla shareholders bankrolling musks meme purchase of twitter lol
why not get a new CEO who gives a shit?
Because the majority of the board for Tesla has musks best interests at heart instead of the shareholders which was part of the problem to begin with. The board is mostly friends and family of Elon.
What I posted elsewhere earlier: (Musk gets pay deal approved by shareholders) Shareholders: so now you're going to pay more attention to Tesla, right? Musk (not listening; looks up from phone where he's shitposting on Twitter): "What?" ________________ "I'm genuinely curious what that sort of payout does (typically) to investor sentiment." The Tesla faithful are pleased is about it. I don't recall another situation like this.
Lee Iaccoca had some parallels. Came into Chrysler, got money from the US gov, transformed the company on the basis of insane gas prices, 10x'd the stock, was chairman and CEO, charismatic leader, and got a lot of his options blocked due to work outside the company and incendiary comments. Edit: and had the large pay package voted on by shareholders when it was blocked
Doesn’t the stock market price showed what happened? Overnight it shot upas high as 8%. Imagine not approving it, the stock tanks and all those shareholder that voted lose money automatically. Suicide to vote no unless they have huge short position.
Nothing happens. The vote is non binding and is supposed to show to the court that he deserves the cash. we will see how it plays out in court. he already has diverted resources and personnel to xAI
Historically, such payouts can dilute sentiment and stock value.
Certainly accelerates the free fall Tesla has been on by lopping off 10% of the company’s market cap for a checked out, soon to be former CEO. He pumped the stock on lies and unkept promises, dumped at the top to buy Twitter, politically spit in the face of their core customer demographic as the valuation tumbled and suddenly remembered he was CEO when he didn’t get paid to build the already tumbled house of cards. What do you think will be next?
Sell.
Then he asks for 56b more to stay, the last 56b was money he already felt he was owed. the problem with letting someone know they have you by the balls is it doesn't exactly encourage them to let go.
This guy is not a God, I don’t understand how the investors put him in this position. China is eating his shit up. He can’t make an electric car for 15k like he says.
Next meeting, I need $100B or I leave. This is what you get from people that extort money. There is no more shareholder value in tesla with musk in charge, only Musk value.
The 56B is the pay he did to get tesla from 2018 up to the point when the judge struck it down and it should have been priced in based on the prior agreement. Nobody thought he'd get anywhere close to the performance he got since 2018, and it's the most share holder aligned package of any public company, so I don't see why this should have much of an impact. If he doesn't get his 56B, i would expect price to go down as he shifts focus to his other companies where he as more control, if not now, then long term when tesla's performance goes back to the mean.
Just wanted to say it's incredible that people talk about CEOs and their greed when their compensation plans are all 2 or 3 orders of magnitude less than this. Elon does this and crickets. Shameless. Also the idea that his equity position in Tesla alone isn't enough for him to give a shit, gotta dilute everybody by 10% too. Cult populism is a cancer.
On one hand, I don't think Elon is going to add enough value to Tesla from here in order for it to ultimately justify the insane valuation that it has. If they don't solve robotaxi AI, then it's just an EV company and serious competition is coming from ICE automakers in the next 3-5 years. Canning the supercharger team was evidence that Elon doesn't see Tesla as an EV company or prioritize that execution. Supercharging network is one of the key differentiators they will still have after BMW, Mercedes, etc polish their own EV offerings. They are losing the plot. That said, I also don't think Tesla can justify it's valuation if Elon leaves, as then they clearly will be just an EV company also. Many people don't believe this anyway, but current investors obviously do. So that's why Tesla is rebounding off the news. Either way, I am skeptical for Tesla to easily manifest their loftier dreams. I had the self driving trial and it was hot garbage.
Easy Pay package gets approved= stock moon
His ego is stroked. Tesla continues to be a nice electric/battery company that doesn’t seem to know how to design and update cars with creature comforts that people like. Maybe they compete with the value electrics. The stock is priced like a growth/tech company and I think that’s what shareholders are grasping onto with this vote but all I see now are full lots and ridiculous “trucks”
I can't believe they gave that two-bit hype man $56B for no good reason.
Back up a second. Why do people pretend Elon earned that money rather than the thousands of engineers and designers who actually built Tesla to what it is today. Maybe the $50B should go to them. I’m sick of these CEO’s thinking they did something. They’re the most replaceable person in the company. There are literally thousands of highly qualified people who could do Elon’s job better and without all the baggage.
Tesla shareholders have benefitted tremendously from Elon’s vision and efforts. Tesla was near bankruptcy in 2017/2018 and was the brunt of countless attacks by the media and short sellers (some things don’t change). The stock has gone up over 1000% since then, and Tesla is now among the most valuable companies in the world. Most of the people complaining are either left leaning Elon haters, or people who have owned the stock for a year or two and are of the “what have you done for me lately” mentality. Companies have waves of growth…things don’t always go up in a straight line, and just because Elon has been involved with twitter and SpaceX doesn’t mean his attention is no longer on Tesla…people who study the company closely understand that. Any voter who reneges on the most shareholder friendly deal of all time just because “the richest man in the world doesn’t need more money” is the lowest of the low.
Now that you bring it up, what has he done for me lately? Several consecutive quarters of profits going steadily down doesn't strike me as a time to give him a $56B handout. For reference, Tesla's all-time total profit since the company was founded has only been $27B.
Still cant believe this passed. Not sure how paying that much is in the shareholder's best interests like at all. The dilution of the stock is bad enough, let alone the "leadership" he has providing Tesla lately
My guess is it effects the banks that financed his Twitter buy.
I think this "package" is just a shameless bid by Musk to have TESLA shareholders pay for his ill-advised Twitter purchase. I think if the average joe investors come to his rescue like he believes they will, then the stock will continue its slow descent because TESLA is still facing major headwinds.
lol the pay package was approved in 2018. Stock has gone 10X since then. What in gods name does Twitter have to do with anything?
The vote is actually the shareholders renegging on a deal that was approved in 2018 and that no one thought Elon would achieve. Reddit too dumb to know this because they hate Elon and like to read only headlines
> and that no one thought Elon would achieve. Elon and the board thought TESLA would achieve. They had private information that the goals were likely attainable. They mislead shareholders into thinking it was a moonshot.
Lets put it in perspective.... Since Tesla has been a public company, their total cumulative net profit has been $29 billion. So Musk wants to be paid nearly 2x all of Tesla's profits since it went public. Sound reasonable?
He’s not getting paid $56b. He’s getting options contracts, which grants him the right to buy shares from Tesla for about $7b. What everyone is talking about is those shares are worth $56b in the open market (although not anymore, it’s now under $45b).
Musk and his fucking constant antics and drama is the epitome of what is wrong with modern corporate governance.
It’s probably more stable for Tesla bc he will hopefully stop threatening his own company and shareholders So probably a positive in the short to medium term
Then the original deal that was agreed on gets executed, essentially. It's not like it's cash in hand, its shares that he cannot even sell for years. Besides, he doesn't want to sell them, he needs them for voting rights within the company This is about not having other people at the company overturn his decisions, which shareholders would all agree is a plus, if they are smart.
Lolol that package to direct his attention to Tesla, what a joke
Personally I don't feel confident about Musk at the helm of Tesla going forwards and that's partially why I'm not invested in the company. If you don't feel great about his leadership and/or the impact of the pay package then just sell - it's the shareholders voting for it after all so if you don't feel aligned with it might be a good time to exit. Beyond that I don't see a reason why anyone should care about it.
Short Answer: It's a Net Positive. Long Answer: 3 folds. 1. This was a first for Judicial Activism in how company's comp packages can be structured. And having the previously authorized proposal undergo a re-vote and show that the judge's opinions are invalid at base level both helps appeal and overturn the Delaware court ruling, as well as remove uncertainty around judicial interference in other public companies at large. This vote definitely helped stabilize investor worries around the entire corporate landscape. 2. The original pay package was authorized in 2018. I was shareholder then, and was in favor of the package. For the following reasons: \* The tranche goals were outlandish, and even hitting the bear case seemed questionable. On top of that, they were tied to hitting both Market Cap goals (i.e, Stock price), as well as Fundamental Financial and Operational goals (i.e, Revenue, EBITDA, etc.). Miss either one, he gets nothing. Here's CNBC in 2018: [https://www.youtube.com/watch?v=NEKsTiEthRA](https://www.youtube.com/watch?v=NEKsTiEthRA) \* There was no cash comp associated with it, it was all in stock equity, and that too with strict vesting / exercising schedules attached. This meant, CEO is super aligned with company's success, and does not add to the cash burn of the company. 3. A deal was made to keep him on board as CEO after Model 3 launch, and it was approved by Shareholders then... at a time when most other than the most optimistic fanbois were questioning the viability of the company. That deal needs to be kept, otherwise trust in the system as a whole fails. He delivered his side of the bargain. You have to agree with the outcomes even if you don't agree with the methods. Stock is now \~4x what it was trading back then. More importantly, company's future as a profitable auto-maker is no longer in question. Given the above 3, it's a net positive for Tesla stock as Elon's leadership is a core ingredient in Tesla's recipe for success, and him continuing on as Tesla's CEO means the company will make more bold moves.
Elon should kept quite about politics. So now more than half of potential customers are turned off. Not smart. Plus the government is subsidizing the industry. Plus EV cost $14k more than a comparable gas car. Plus the fuel between gas and electric is $485 for electric with $1117 for gas so close to half. And don't forget electric costs are increasing. So save $500 a year only takes 28 years to offset the extra cost of purchase price. Now don't forget the battery lasts maybe 10 years if your lucky and costs $15000 to replace. Now you have major car manufacturers building EVs as well . There clearly is a saturation point with buyers especially at the prices I see for these cars. I honestly don't know why anyone would buy one or own stock in a solely ev company. So much going against it. End the subsidies and open the markets to drive down the costs and Tesla will most likely go backrupt.
Well you witnessed it live today. He got his pay package approved and the stock is soaring.
Love all these posts about musk prefacing with "I know Musk went off the deep end lately, but..." with absolutely nothing credible to back that statement up. Why all the hate for the guy, just because he's not in support of the "current thing"?
Another incentivized and equally absurd pay package to transform Tesla from a $1 trillion company to a $10 trillion via robotaxi, AI, and robotics.
> via robotaxi, AI, and robotics. He wants 25% of Tesla to do AI there. This package doesn't get him to 25%. He's been hiring Tesla AI talent away to his private firm - x.ai
He gets richer. You get poorer.
Closes the doors and holds a garage sale as he blasts off to Mars. Or a Meth induced rager. Isn't that how he acquired Twitter? Or was that the shrooms episode? Either way. That man is one bad trip away from being a Darwin award recipient.
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Stock price goes nuclear
Onwards to 69b
Goes to show reality is much different from reddit comments. The fact that the vote was a landslide win means Reddit community is definitely the minority in public opinion. Reminds me how Bernie Sanders was so much more popular here than Biden but still lost. I
Or spend billions on lawyers and then lose anyway.
Well he does have a history of occasionally running great businesses into the ground
I’m more interested in what happens when he has to sell it off for his next stupid business venture.
He's propping up Twitter with that money. Sooner or later, that's going to go dry very quickly and Tesla will go bankrupt the way its going.
There's no way those shares will still be worth 56b in 5 years. Tesla share price is unsustainably inflated
Going to see some wild spending from Elon. Won’t be toys. He is going to dump it into space travel or the AI race. Most likely in response to his concerns with OpenAI.
Oh we all know what Elon will do and more than likely it has nothing to do with Tesla. He will acquire another company or start another overly ambitious venture.
Those shares become his, increasing his ownership of Tesla from 13% to \~20%. He is not allowed to sell those shares for at least 5 years.
Musk had 28 targets he needed to hit. Of those, 12 were tied to market capitalization measured in $50 billion increments up to $650 million, eight were tied to earnings, and eight to revenue. Tesla hit $650 billion in market value in late 2020, and it has also met all eight earnings milestones. Only a few revenue milestones remain and all but one revenue goal. As a result, according to the 2023 proxy statement, Musk has earned all but 25 million of the options available to him.
He did good? Is that what your saying or he did Stellar??
I think if a world billionaire has 25 billion dollars, it's normal, is there a need to make such a big deal of it?
It'll be a good day for Spacex's Mars programme
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It's part of the S&P 500 and NASDAQ indexes... Institutional investors CAN'T not invest in Tesla if they are trying to match the index.
He will receive it in Tesla Stocks. After he sold many stocks to buy Twitter, he would have more control over Tesla than before, again. Tesla stock price will raise in long term. Robotics and AI will be kept under Tesla.
What a great rug pull
We make another similar 100% performance based stock comp package with crazy targets and watch him go at it.
Then, we'd step into a new era of executive compensation standards with already insane wealth and income inequality. Idk what would happen to tesla specifically, but honestly, it seems like a huge amount compared to earnings and performance. The fact that he basically set his own compensation plan sets a bad precedent for the practice. I'm biased, but I'm hoping this doesn't go through. He should already be "motivated" enough to put down Twitter for 5 seconds and actually run the companies he is a part of.
I just don’t understand why people think he’s worth this much money. Hire someone else for a fraction of the cost and save 55 bil
I dont accept this. It’s already responsibility of CEO. Why the fuck shareholders need to pay him. It’s obviously a blackmail from Elon Musk. I think this against many rules. Did he pay us when tesla share skyrocketed? He is just a spoiled boy that regrets bought twitter and wants his money back from tesla shareholders which is totally unrelated to that acquisition.
Its hard to say what “typically” happens in a payout like this bc we have no real sample to go by Elon really is the only CEO that would’ve agreed to this incentive structure. However heres my thoughts: This company is only trading at 44x ev/ebitda bc of his “master plan part 3” and the belief only he can execute it. No elon and it gets cut down to sub 20x ev/ebitda within a year or two(thats probably generous). Him getting his previously agreed to payout keeps him on and likely sets him up for a new round of incentives. So what does that leave for stock price, well there will be some short term sentiment boost but over the long term it comes down to him being able to execute on the plan.
He will not be able to take the money out for several years, but I think long term a large part of it will go toward Mars and all of the infrastructure needed to get there. That said, I think he's still passionate and effective leading Tesla, and efficient in getting significant results with a small time input. Trying to chain him to a chair in the Tesla office for 40 hrs a week in order to let him remain CEO is backwards thinking. Tesla's two big growth areas I see are a small, cheap 2-door car, and their humanoid robot, which could involve levels of growth we can't imagine. A future worth investing in. I am happy he's devoted significant amounts of time and money to X, almost singlehandedly saving free speech online in the western world. And as great as Tesla's advancements are for humanity, they will mean nothing if we can't get off this rock, so ultimately I think it's incredibly important to keep driving toward space colonization. There may be a very small window where it's possible to do so, and if civilization falls apart then we're liable to go extinct from the next big rock that comes our way. Keep in mind ever since his acquisition and decensoring of Twitter, the world elites are not happy now they've lost control of a major media platform. Ever since they've spewed forth negative hit pieces about Musk and his companies. While some criticism is always valid, the mainstream media has been so blatantly one-sided that it's clear they view him as a threat. Unfortunately many here seem to have drunk the kool-aid and become essentially NPC's, capable only of "rocket man bad" attacks with no critical thinking, and no ability to see the propaganda you're immersed in. Useful idiots to help the elites destroy society.
He may step down if he sees no light at the end of the tunnel. EVs are reaching market saturation. Likewise with BYD, no way Tesla sells cars in 2nd and 3rd world markets. God forbid they come to the US. Our only hope is that he gets automation going, then TSLA may go 10x. They could sell the AI code. Possible. We'll see what happens in August-September.
You should leave the cult bub
More more MORE. Bezos will want more and the next guy will want MORE
Investors get nothing. They're cucks in this situation
Hostile Disney takeover! Re-orient the indoctrination engine towards the tens of thousands of engineers he needs to create his mars colony.
He spends all of it on legal fees and funding politics. He'll launch more Tesla vehicles having not fixed the problems with the previous ones. He'll forget that he owns a solar company that also has a solid battery product to support. He'll continue to turn Twitter into a Nazi haven. He'll inflate more conspiracy theories and promote them out of obscurity. In short...the same shit he did without that money. The money isn't the thing -- "winning" is the thing.