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Ridiculous and biased article. Elon gets ZERO compensation if Tesla doesn't do stellar performance. Any tesla shareholder knows how Tesla is structured (Elon-fo

Ridiculous and biased article. Elon gets ZERO compensation if Tesla doesn't do stellar performance. Any tesla shareholder knows how Tesla is structured (Elon-focused) so just don't buy the stocks if you don't like Elon. It also fails to completely mention Tesla stock's currently at an all time high.

xmprt 1y ago
The US has some broken incentives where if a small company fails then it hurts the shareholders but if a large company fails, it's "too big to fail" and ends up getting bailed out by the government. That's why it's worrying how Tesla is growing unsustainably. If the risk pays off then shareholders reap the benefits but if it crashes and burns then everyone takes a hit.
- ralph84 1y ago
  The automakers that got bailed out had large unionized workforces and franchised dealer networks, both of which are very politically active and neither of which Tesla has.
preisschild 1y ago
> Any tesla shareholder knows how Tesla is structured (Elon-focused) so just don't buy the stocks if you don't like Elon. So Tesla is not a car manufacturer, but a cult of personality?
- neogodless 1y ago
  Tesla is a car manufacturer, but Tesla stock valuations are not based on that fact.
  - deleted 1y ago
    [deleted]
  - JumpinJack_Cash 1y ago
    This makes me think that executives in the manufacturing sector should be paid in kind AKA in product, if that is the hot stuff that they claim they'd have zero problems selling the product on the secondary market and collect dollars
Veserv 1y ago
Elon Musk currently owns 12% of Tesla. Claiming he gets “ZERO compensation” outside of stellar performance is nonsense. If Tesla actually reached a 8T dollar valuation his net worth would increase to 1T dollars without any additional grants or investor dilution. He currently directly shares 12% of the growth of Tesla, far more than most executive teams which are viewed to be adequately aligned with far less ownership. Claiming there is no incentive to perform is nonsensical and incoherent.
- orionsbelt 1y ago
  He may be incentivized, but it is not “compensation” if he already owns it IMO.
  - Veserv 1y ago
    So if I get 12% of the profit from music sales that is not “compensation”? Share ownership is, at its foundation, a profit (and asset) sharing agreement. You are getting confused by the fact that this class of profit sharing agreement can be easily sold for its expected net present value of all future cash flows and that they frequently retain earnings in tax advantaged forms instead of directly distributing their generated income in highly taxed forms.
    - orionsbelt 1y ago
      1. Elon could quit and do zero work and he would still own the 12%. So what is his compensation for the extra work? 2. If you owned $10M worth of shares of TSLA from your personal investments, and applied to work at TSLA, would it be reasonable to deny you any compensation since you are already incentivized and share in the success? This is not to comment on what the right pay package is; perhaps the proposed one is far far too rich, but that's a separate question to whether his existing assets are compensation or not.
      - Veserv 1y ago
        1. 12% of the increased profits. If we used your logic then we would conclude that 100% owners of businesses are not being compensated for their work. They are literally being compensated all of the profit and asset growth. 2. Yes, it is fairly common to “compensate” executives primarily in the form of their own stock appreciation [1]. Mark Zuckerberg receives 1$ in salary, options, stock awards, with only a tiny 20 M$ as reimbursements to avoid running afoul of tax law [2]. Larry Ellison [3] got only 8 M$. Michael Dell only got 3 M$ [4]. Andrew Jassy only 1 M$ [5]. Should I keep going? [1] https://en.wikipedia.org/wiki/One-dollar_salary https://en.wikipedia.org/wiki/One-dollar_salary [2] https://www.salary.com/research/executive-compensation/mark-zuckerberg-executive-member-of-facebook-inc https://www.salary.com/research/executive-compensation/mark-... [3] https://www.salary.com/research/executive-compensation/lawrence-j-ellison-executive-member-of-oracle-corp https://www.salary.com/research/executive-compensation/lawre... [4] https://www.salary.com/research/executive-compensation/michael-s-dell-executive-member-of-dell-technologies-inc https://www.salary.com/research/executive-compensation/micha... [5] https://www.salary.com/research/executive-compensation/andrew-r-jassy-executive-member-of-amazon-com-inc https://www.salary.com/research/executive-compensation/andre...
scrollop 1y ago
Well, he should be getting a negative amount considering how his actions have effected the stock price. He's a liability.

xmprt 1y ago

The US has some broken incentives where if a small company fails then it hurts the shareholders but if a large company fails, it's "too big to fail" and ends up getting bailed out by the government. That's why it's worrying how Tesla is growing unsustainably. If the risk pays off then shareholders reap the benefits but if it crashes and burns then everyone takes a hit.

ralph84 1y ago
The automakers that got bailed out had large unionized workforces and franchised dealer networks, both of which are very politically active and neither of which Tesla has.

preisschild 1y ago

> Any tesla shareholder knows how Tesla is structured (Elon-focused) so just don't buy the stocks if you don't like Elon. So Tesla is not a car manufacturer, but a cult of personality?

neogodless 1y ago
Tesla is a car manufacturer, but Tesla stock valuations are not based on that fact.
- deleted 1y ago
  [deleted]
- JumpinJack_Cash 1y ago
  This makes me think that executives in the manufacturing sector should be paid in kind AKA in product, if that is the hot stuff that they claim they'd have zero problems selling the product on the secondary market and collect dollars

Veserv 1y ago

Elon Musk currently owns 12% of Tesla. Claiming he gets “ZERO compensation” outside of stellar performance is nonsense. If Tesla actually reached a 8T dollar valuation his net worth would increase to 1T dollars without any additional grants or investor dilution. He currently directly shares 12% of the growth of Tesla, far more than most executive teams which are viewed to be adequately aligned with far less ownership. Claiming there is no incentive to perform is nonsensical and incoherent.

orionsbelt 1y ago
He may be incentivized, but it is not “compensation” if he already owns it IMO.
- Veserv 1y ago
  So if I get 12% of the profit from music sales that is not “compensation”? Share ownership is, at its foundation, a profit (and asset) sharing agreement. You are getting confused by the fact that this class of profit sharing agreement can be easily sold for its expected net present value of all future cash flows and that they frequently retain earnings in tax advantaged forms instead of directly distributing their generated income in highly taxed forms.
  - orionsbelt 1y ago
    1. Elon could quit and do zero work and he would still own the 12%. So what is his compensation for the extra work? 2. If you owned $10M worth of shares of TSLA from your personal investments, and applied to work at TSLA, would it be reasonable to deny you any compensation since you are already incentivized and share in the success? This is not to comment on what the right pay package is; perhaps the proposed one is far far too rich, but that's a separate question to whether his existing assets are compensation or not.
    - Veserv 1y ago
      1. 12% of the increased profits. If we used your logic then we would conclude that 100% owners of businesses are not being compensated for their work. They are literally being compensated all of the profit and asset growth. 2. Yes, it is fairly common to “compensate” executives primarily in the form of their own stock appreciation [1]. Mark Zuckerberg receives 1$ in salary, options, stock awards, with only a tiny 20 M$ as reimbursements to avoid running afoul of tax law [2]. Larry Ellison [3] got only 8 M$. Michael Dell only got 3 M$ [4]. Andrew Jassy only 1 M$ [5]. Should I keep going? [1] https://en.wikipedia.org/wiki/One-dollar_salary https://en.wikipedia.org/wiki/One-dollar_salary [2] https://www.salary.com/research/executive-compensation/mark-zuckerberg-executive-member-of-facebook-inc https://www.salary.com/research/executive-compensation/mark-... [3] https://www.salary.com/research/executive-compensation/lawrence-j-ellison-executive-member-of-oracle-corp https://www.salary.com/research/executive-compensation/lawre... [4] https://www.salary.com/research/executive-compensation/michael-s-dell-executive-member-of-dell-technologies-inc https://www.salary.com/research/executive-compensation/micha... [5] https://www.salary.com/research/executive-compensation/andrew-r-jassy-executive-member-of-amazon-com-inc https://www.salary.com/research/executive-compensation/andre...

scrollop 1y ago

Well, he should be getting a negative amount considering how his actions have effected the stock price. He's a liability.