Elon Musk gets $4.3 million in stock pay for Model X work

Article by Anita Panait, on August 12, 2013

Tesla Motors Inc. co-founder and chief executive Elon Musk received $4.3 million in stock-based pay in the second quarter of 2013 for his work on the Model X sports. Musk’ s pay accounted for over 20 percent of the $19.3 million in stock-based compensation Tesla reported in the second quarter. The stock pay was one of three adjustments of over $16 million that the carmaker used to justify a $30.5-million net loss should be considered as a $26.3 million profit.

On the adjusted basis, Tesla posted a second-quarter profit of 20 cents a share, or 5 cents, excluding an adjustment for lease accounting. This surpassed the 20-cents-per-share loss average estimate of 10 analyst surveyed by Bloomberg, and was a primary factor in Thursday’s 14-percent surge of Tesla’s stock. Tesla reported its financial results for the second quarter of 2013 after the market closed on Wednesday.

Kevin Tynan, a Bloomberg Industries auto analyst, remarked that Tesla "is acting a lot more like a technology company than an automaker at this point." Excluding stock-based compensation from net income is more typical in technology companies in the Silicon Valley than in the global auto industry.

Tynan remarked that granting the stock options for development work that has yet to be completed does not pose a problem since that is not uncommon, especially if the person concerned is on target. Tesla reposted its first net profit in the first quarter of 2013 and Consumer Reports magazine has hailed its Model S electric sedan as one of the best cars ever made.

Built throughout as an electric vehicle, the new Tesla Model X was intended to become the safest car on the road. As per Tesla's own crash tests, it expects the Model X to become the first SUV to earn a 5-star safety rating in all crash categories.

Since the Model features no gasoline engine, its front crumple zone is large enough to absorb the impact from a high-speed collision. Moreover, the Model X has a low risk of rollover, thanks to the fact that its battery is located on the floor. The Model X also employs aluminum pillars reinforced with steel rails, thereby making the roof stiffer while protecting occupants and the battery.

As standard, the new Model X is provided with a number of active safety features like side collision avoidance and automatic emergency braking – the only system the works even at high speeds. To enable advanced autopilot features, the new Model X comes with radar, a forward-looking camera, radar and 360-degree sonar sensors.

Thanks to Tesla's over-the-air software updates, these features keep up with time and technology. These updates enable certain safety and convenience features like Autosteer and Autopark, and allow the SUV to pursue autonomous operation.

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