by v12 » Wed Jan 05, 2022 2:49 pm
logos wrote: βTue Jan 04, 2022 4:31 pm
Here's a good recap and analysis of Elon Musk's compensation package.
Unlike what V12 mistakenly assumes, it doesn't cost a cent to the other shareholders. Nor to Tesla. His package depended on achieving targets that looked impossible when it was designed back in 2017.
Musk deserves every one of those multiple billions. Although the numbers sound mammoth, his big take is being paid out of what he created. In fact, itβs such a small sliver of the mountain of value heβs built that itβs costing his shareholders relatively little in dilution. Thatβs how a great comp plan is supposed to work.
Full article here
https://fortune.com/2021/03/16/elon-mus ... tion-plan/
Thanks for the article.
I think, you need to give the article another read. It certainly explains how the Musk pay package is set up, however, it does not say, who does pay the difference between the "historic" share price of USD 70 and the current share price (which is the profit for Musk, something like USD 330 per share).
Looks to me, there is a smart item in the bucket: The shares were/are in the closet at Tesla. And, because Musk does have many, many more options going to expire in the upcoming years, there are a lot of shares more in that closet.
Which immediately implies, Tesla is an immense rich company, since it does have a huge amount of shares, with an ultra-high stock value. Which implies, Tesla can loan a lot of money to set up manufacturing, and do whatever Musk wants to play with, just with the shares as collateral. Smart.
Which in turn implies, given the drivers for Musk's pay package being the car production and not the profit, Tesla does have a huge war-cache to out-bit all other car manufacturers to obtain electronic parts. Profitability is not an item, just the amount of produced cars as well the shares price.
So now we know why Tesla is able to obtain the scarce electronic parts (and deliver cars) and other manufacturers suffer with their deliveries. Smart.
Or so to say, this has been an extremely smart setup, that Musk gets the benefits, where the Tesla company pays for it. A construction, many, many US CEO's did bring into their payment package.
It also explains why Musk can play Santa Claus and "invest" in so many other activities: Driven by the loans with the shares in the closet as collateral. Or so to say, when the share price falls, the loans go to default and Tesla goes with it.
Your referred article does contain a graphic. Did you study that graphic ? Let me quote (if that works):
The important part is the right top of the growth: It is rounding off from early 2021, and I would say, it is at it's peak at the moment. From now on, it is going down. Which explains why Musk did exercise the options some 2-3 months ago (and did not wait until Aug 2022). Smart.
And, the huge amount of Tesla stocks in the Tesla closet also explains why the shares go up and up and up: Together with the amount of shares Musk does have, there is a limited amount of Tesla shares "free" available for trade, which creates a shortage, which in turn boosts the share price, when the company is hyped. And, this is what we see happening.
Remember what happened, when Porsche tried to take over VW ? It didn't work, due to the lack of free available shares, which increased the stock price immensely. With the result that Porsche failed/crashed and VW could easily take over Porsche on the cheap (which happened).
So, all planned, very, very smart.
Can this money generating scheme continue like this ? Of course not, the Tesla war-cache will both degrade and be gradually transferred to Musk, and it's over with the loss-leading Tesla car production. And the Tesla car being a dull and an inferior car from the car perspective (as all US designed cars tend to be), Tesla is never going to win that battle.
See this article from a completely different industry, Tesla seems to have an all-over-the-cars market share in the US of around 2%. And all US car manufacturers only have 40% of the car market share in the US, declining.
Toyota passes US manufacturers
Even the "hyped" Nikola Trucks was completely fake.
The Nikola Truck driving demo video was just a downhill freewheeling. Just like the first "introduced" glamour Boing 787, just an empty shell. Just fake. Or the hyped Theranos, also an empty hyped shell. Or Evergrande, also a Ponzi scheme hyped failure. All assuming a sustained double-digit growth.
So, the question is: When do we see Musk ending up in court, like Holmes and several others ?
[quote=logos post_id=1041684 time=1641288667 user_id=328]
Here's a good recap and analysis of Elon Musk's compensation package.
Unlike what V12 mistakenly assumes, it doesn't cost a cent to the other shareholders. Nor to Tesla. His package depended on achieving targets that looked impossible when it was designed back in 2017.
[quote]Musk deserves every one of those multiple billions. Although the numbers sound mammoth, his big take is being paid out of what he created. In fact, itβs such a small sliver of the mountain of value heβs built that itβs costing his shareholders relatively little in dilution. Thatβs how a great comp plan is supposed to work.[/quote]
Full article here
https://fortune.com/2021/03/16/elon-musk-net-worth-tesla-stock-tsla-options-compensation-plan/
[/quote]
Thanks for the article.
I think, you need to give the article another read. It certainly explains how the Musk pay package is set up, however, it does not say, who does pay the difference between the "historic" share price of USD 70 and the current share price (which is the profit for Musk, something like USD 330 per share).
Looks to me, there is a smart item in the bucket: The shares were/are in the closet at Tesla. And, because Musk does have many, many more options going to expire in the upcoming years, there are a lot of shares more in that closet.
Which immediately implies, Tesla is an immense rich company, since it does have a huge amount of shares, with an ultra-high stock value. Which implies, Tesla can loan a lot of money to set up manufacturing, and do whatever Musk wants to play with, just with the shares as collateral. Smart.
Which in turn implies, given the drivers for Musk's pay package being the car production and not the profit, Tesla does have a huge war-cache to out-bit all other car manufacturers to obtain electronic parts. Profitability is not an item, just the amount of produced cars as well the shares price.
So now we know why Tesla is able to obtain the scarce electronic parts (and deliver cars) and other manufacturers suffer with their deliveries. Smart.
Or so to say, this has been an extremely smart setup, that Musk gets the benefits, where the Tesla company pays for it. A construction, many, many US CEO's did bring into their payment package.
It also explains why Musk can play Santa Claus and "invest" in so many other activities: Driven by the loans with the shares in the closet as collateral. Or so to say, when the share price falls, the loans go to default and Tesla goes with it.
Your referred article does contain a graphic. Did you study that graphic ? Let me quote (if that works):
[IMG=https://content.fortune.com/wp-content/uploads/2021/03/musk_compensation_031121-01.png?w=1001]Tesla Market Capitalization[/IMG]
The important part is the right top of the growth: It is rounding off from early 2021, and I would say, it is at it's peak at the moment. From now on, it is going down. Which explains why Musk did exercise the options some 2-3 months ago (and did not wait until Aug 2022). Smart.
And, the huge amount of Tesla stocks in the Tesla closet also explains why the shares go up and up and up: Together with the amount of shares Musk does have, there is a limited amount of Tesla shares "free" available for trade, which creates a shortage, which in turn boosts the share price, when the company is hyped. And, this is what we see happening.
Remember what happened, when Porsche tried to take over VW ? It didn't work, due to the lack of free available shares, which increased the stock price immensely. With the result that Porsche failed/crashed and VW could easily take over Porsche on the cheap (which happened).
So, all planned, very, very smart.
Can this money generating scheme continue like this ? Of course not, the Tesla war-cache will both degrade and be gradually transferred to Musk, and it's over with the loss-leading Tesla car production. And the Tesla car being a dull and an inferior car from the car perspective (as all US designed cars tend to be), Tesla is never going to win that battle.
See this article from a completely different industry, Tesla seems to have an all-over-the-cars market share in the US of around 2%. And all US car manufacturers only have 40% of the car market share in the US, declining.
[U][B][URL=https://edition.cnn.com/2022/01/04/business/toyota-gm-us-auto-sales-leader/index.html]Toyota passes US manufacturers[/URL][/B][/U]
[U][B][URL=https://www.pprune.org/rumours-news/644450-airlines-want-boeing-build-180-250-seats-modern-757-4500nm-range-before-2028-a-3.html#post11165235]Even the "hyped" Nikola Trucks was completely fake.[/URL][/B][/U]
The Nikola Truck driving demo video was just a downhill freewheeling. Just like the first "introduced" glamour Boing 787, just an empty shell. Just fake. Or the hyped Theranos, also an empty hyped shell. Or Evergrande, also a Ponzi scheme hyped failure. All assuming a sustained double-digit growth.
So, the question is: When do we see Musk ending up in court, like Holmes and several others ?