Tesla CEO Elon Musk has achieved six of the ten operational goals (up from five last year) given to him in 2012 when he was awarded 5.27 million stock options, according to Bloomberg. The EV firm has met eight of ten market value milestones, an increase from seven last year, according to the filing. As per Bloomberg’s calculation, these remaining milestones, if achieved, would be worth approximately $1.4 billion for Musk.
What milestones remain for Tesla?
Musk has been given a deadline of 2022, but he could reap in the benefits early if the company achieves its targets ahead of the scheduled time.
“The $1.4 billion windfall from his options is based on what Musk would pocket if he’d been able to exercise all 5.27 million of them on Thursday, when Tesla shares closed at $302.51 in New York,” says Bloomberg.
Tesla delivered about 25,000 vehicles in the first quarter, bringing the total number of produced vehicles over 200,000, but that number (also a milestone) will be confirmed only after the board approves it, the filing says. The Palo Alto-based company stated that it will start manufacturing the more affordable Model 3 in July and expects an annual output of about 500,000 vehicles by 2018.
Along with the production target, the EV firm is also required to maintain a gross margin of at least 30% for four straight quarters. For the most recent four quarters, the company posted gross margins ranging between 19% and 28%, notes Bloomberg. Further, if Musk wants to receive that $1.4 billion, Tesla’s market value must be above the $43.2 billion threshold for the next six months, translating into $270 per share. The EV firm briefly outran General Motors to become the most valuable automaker in the United States.
How Musk gets the best from employees
Some insight into how Musk achieves these milestones reveals that the CEO plays rather an unusual trick to get the most out of his employees. A popular biography of Musk by Ashlee Vance indicates that after interviewing the three dozen SpaceX engineers, Vance learned that Musk gives ownership of the project to the workers.
“He doesn’t say, ‘You have to do this by Friday at 2 p.m.,'” early SpaceX engineer Kevin Brogan told Vance. “He says, ‘I need the impossible done by Friday at 2 p.m. Can you do it?’
Musk never stops to amuse investors and admirers with his ideas and plans. Musk and other leaders in the tech industry are forming a new company to prevent a robot apocalypse. The latest venture, OpenAI, is aimed at controlling the development of artificial intelligence in such a way that it benefits instead of threatening humanity.
OpenAI will be a nonprofit company and remain beyond all financial obligations in order to make a more positive impact. The company will create universal protocols for companies to follow to ensure the responsible development of AI.
On Thursday, Tesla shares closed down 0.99% at $302.51. Year to date, the stock is up almost 42%, while in the last year, it is up almost 19%. The stock has a 52-week high of $313.73 and a 52-week low of $178.19.