Elon Musk works for Tesla for free but still racks up millions; Here's why

As the Tesla share struggles to recover, reports are emerging that CEO Elon Musk is currently working for free in his electronic automotive company. According to CNN, the business mogul hasn’t taken any kind of cash salary since 2019. In the year 2019, Musk only received a sum of USD23,760, which was required under the California minimum wage law. However, Musk still has managed to rack up billions of dollars during this time, but not in the way that his regular workers make their money. 

According to CNN, Musk became the richest person alive through lucrative packages of stock options. The packages gave him the right to buy hundreds of millions worth of Tesla shares for a fraction of their market price. It was the year 2012 when Musk was granted the package options, however, the options he had received expired last year. Hence, the SpaceX CEO is currently not adding a lot to his portfolio, no matter how well his electronic automotive company does. As per the report by CNN, this was part of the reason why he lost the crown of the richest person alive, to Bernard Arnault, the Founder, Chairman and CEO of Moët Hennessy Louis Vuitton (LVMH).

Musk still racks up millions

While the Tesla CEO is not taking cash salary for his work, the billionaire’s net worth still stands at USD198 billion. Since Musk has a significant stake in Tesla, the better the company does under his leadership, the more he will be worth. According to CNN, currently, Musk owns 412 million shares of Tesla stock outright and holds options to purchase another 304 million at a bargain-basement price of USD23.34 a share. The American news outlet also reported that the adjusted exercise price evaluation of these shares is USD142 billion, based on Friday market prices.

Things are also looking good for Musk, after facing a major plunge last year, Tesla shares are recovering at a steady pace. It is also being reported that the Tesla board could soon announce a new pay package for Musk.  “I would expect an absolutely monster package for Musk,” Daniel Ives, a tech analyst at Wedbush Securities told CNN. “I think Musk is the lifeblood of Tesla. He’s a key part of the premium in the stock,” he added.