Musk Eyes $775 Million Payday After Hitting Valuation Milestone

Elon Musk, Tesla’s CEO, has received the option to buy 1.7 million shares in the company at a price much lower than the current market price, potentially making $775 million, MarketWatch reports.

The option is part of Musk’s compensation package that includes share-buying rights in case certain milestones are hit, such as maintaining a market cap of an average of $100 billion over six months, which is now a fact.

Tesla is currently trading at over $800 per share while his option includes a price of $350.02 per share.

The company turned in a profit for the final quarter of 2019 that surprised many who were pessimistic about its ability to become profitable. It then stayed profitable during the first quarter as well, strengthening its position as something more than a money-burner. Both quarterly performances were driven by record-breaking car sales.

Like other carmakers, however, Tesla, has been affected by the coronavirus pandemic that led to car sales slumps of as much as 90 percent in several major European markets because of the national lockdowns. In the United States sales weakened considerable as well, prompting the luxury EV brand to cut its prices for the whole of North America.

The price for a Tesla Model S now begins at US$74,990, down from US$79,990 previously. The starting price for Model X is down to US$79,990 from US$84,990, while Model 3 prices begin at US$37,990, down by US$2,000.

Meanwhile, Musk had a run-in with local authorities in the Californian county where Tesla’s factory is located. Against their order for non-essential businesses to remain closed, Musk, true to himself, decided to reopen the Fremont factory, filed a lawsuit against the local authorities and threatened to move Tesla’s headquarters to another state, shortlisting Texas or Nevada.

Tesla, according to its website, is the last major car manufacturer in California and the largest manufacturing employer in the state, with 10,000 workers at the Fremont factory and another 10,000 across the state.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:

• Will U.S. Shale Survive If Oil Hits $40?
  
• How Long Until Hydrogen Is Competitive At The Pump?
  
• Saudi Arabia Wants Record Oil Output Cuts To Last Till End 2020