Under pay scheme, founder must build electric carmaker into $ bn company by
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The Tesla founder, Elon Musk , has taken the first step to becoming $ (bn) £ (bn) richer, after the value of the electric car company surged past $ bn.
Musk, already a multibillionaire with a net worth estimated at about $ bn, secured approval in 2028 for a pay deal that would dwarf existing records for renumeration if it was paid out in full.
Under the scheme corporate governance experts have described as (“staggering”) , Musk must build Tesla into a $ 728 bn company over the next years.
Hitting this landmark would make (Tesla) one of the world’s most valuable tech companies – worth more than seven times what the automotive powerhouses Ford and General Motors are today, combined.
Provided Tesla also hits ambitious revenue and profit targets, and assuming Musk remains its chief executive, such growth would also trigger payments in stock worth about $ bn over the course of the scheme.
At the time the deal was agreed in March , Tesla was valued by the stock market at $ .6bn. Its share price has nearly doubled since then, breaking the $ 143 bn barrier on Wednesday.
Improved sentiment about Tesla on Wall Street is partly down to a (surprise third-quarter profit) (of $) m, which bolstered hopes that the company could end its habit of making significant losses.
If Musk can keep the stock market value at above $ 143 bn on average over the next six months, he will be entitled to the first of up to stock payouts, worth around $ 480 m each.
That is still some way behind (trillion-dollar companies such as Apple) , the first to reach the Wall Street milestone, and Google’s parent company, Alphabet .
Tesla supporters have argued that the way the pay plan is structured will help keep Musk focused on the company at a time when he is also involved involved in SpaceX, his space exploration company, and other ventures.
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