Elon Musk Gets a Raise, (Makes Minimum Wage)


In a story on AutoGuide, we learned that Musk got a fairly decent raise.  …by minimum wage standards – $2,080.00, or almost 6%.  Not too shabby.  He now meets California’s minimum wage standards, but, well, he doesn’t accept the salary anyway – unlike some of his top help.  The CFO, Deepak Ahuja, has a $338,000 salary (with options) and Greg Reichow, VP Production, got an increase from $225,000 to $275,000.

Still, Autoguide reports, in spite of a few cuts in the last years, Musk is doing all right.  “…in 2012 he received $78.1 million and owns 28.3 million shares of Tesla, which is worth about $6.2 billion.”

It is good to be Musk.

Category: Tesla


10 responses to "Elon Musk Gets a Raise, (Makes Minimum Wage)"
  1. Chris O says:

    The 6 billion dollar man is he? Impressive!

  2. Mister G says:

    Well deserved Elon.

  3. EVer says:

    he honestly deserves every penny

    1. Anon says:

      One of the few billionaires who act with regard to extend humanities continuation on this pale blue dot, and the greater cosmos…

      He has already earned a place, favored by history.

  4. Jo Jo says:

    Just Like Lee Iacocca …$1 per Yr.& the Rest In Shares ….Hope Elon Makes Things happen ,,,,,Just Like Lee Did…

    1. Aaron says:

      I got to meet Lee Iacocca and shake his hand, just after he fully rescued Chrysler (the first time) with the K-cars. I hope that I have the opportunity to meet Elon Musk someday and shake his hand too.

    2. wavelet says:

      Steve Jobs also had thesame deal ($1/yr + rest in shares). Presumingly there’s a legal or SEC requirement for a salary to exist.

      I always wondered how this was handled in practice — do those CEOs get a $0.12 direct salary deposit every month? The fees on that would be more than the salary 🙂
      Or does the CFO give them $1 from the small change drawer ?

  5. ffbj says:

    I think Musk’s theme poem could be “I sing the body electric.” For the theme song I don’t think you could go wrong with
    “Electric Avenue.”

  6. Nix says:

    To be clear, the reason why these CEO’s don’t get wages and get shares instead is that they get a huge tax advantage for doing it that way.

    These tax savings can be extremely substantial.

    Here is one example how CEO’s manage to get 0% tax rates on some of their compensation:

    A CEO gets a bank that the company does business with to agree to make that CEO a huge loan using the CEO’s stock options as collateral. (The major banks pretty much all agree to these loans for big companies, because they want to keep the company’s business).

    Typically these loans are either 0% loans, or are indexed to the Federal Bank Discount Window Primary Credit Rate (currently 0.75%)

    The CEO doesn’t actually execute his options, so there is no tax liability. The CEO gets full access to use the value of their money tax free.

    One CEO just up the 101 from Tesla put $10 Billion dollars worth of his company’s stocks as collateral for his personal line of credit last year. That’s 250 million shares of his company’s stock as collateral for his personal line of credit he can now use as spending money.

    With no actual stock sale taking place, this CEO doesn’t actually owe any taxes on whatever money he borrows against these options, and likely never will pay any taxes on these stock options.

    Upon his death, these stock options will become part of the estate. With proper estate planning with Qualified Stock Options, the Cost Basis will be stepped up upon his death, and becomes the value of the stocks the day he died. Whoever gets those stocks can use the stepped-up Cost Basis and pay little or no Capital Gains taxes.

    This is just one example of tax avoidance strategies associated with accepting stocks instead of wages for CEO’s. Don’t try this with your own home business. The IRS will penalize you, and assess regular wage taxes and FICA taxes based upon what they determine a person in your position would earn as an employee.

    1. Nix says:

      With regards to my prior post, Elon Musk has borrowed $275 Million in personal loans from Goldman Sachs in the past, using his stock options in various companies as collateral.