Tuesday 21 July 2020 8:29 pm

Musk qualifies for $2.1bn payday after Tesla rally

A prolonged bounce in Tesla’s share price means its chief executive Elon Musk has qualified for a $2.1bn payout, in his second award since May.

The electric carmaker’s six-month average market capitalisation officially surpassed $150bn today, triggering the vesting of the second of 12 tranches of options granted to Musk in 2018.

Musk, who is also majority owner and chief executive of rocket firm Space X, receives no salary.

Tesla is now the world’s most valuable carmaker, almost reaching $300bn this month to be worth more than the market values of Toyota, Ford, General Motors and Fiat Chrysler combined.

Read more: Tesla nears record for first stock to reach $20bn short interest

It is set to report its quarterly earnings on Wednesday evening, which if profitable, will determine whether Tesla can enter the S&P 500 index on Wall Street.

Analysts’ estimates for Tesla currently range from an adjusted loss as steep as $2.53 a share to a $1.41 per share profit.

However on average, they expect an adjusted 11 cents loss per share and a net loss of $240m, according to Refinitiv data.

Tesla shares have surged more than 275 per cent so far this year, though reporting a loss this evening could send its stock plummeting.

Read more: German court bans Tesla ads over self-driving claims

Earlier this month, Tesla surpassed expectations when it announced it had delivered more than 90,000 vehicles in the quarter, defying a wider industry downturn.

But while vehicle deliveries increased 2.5 per cent on a quarterly basis, production dropped nearly 20 per cent. Tesla had previously predicted it would deliver at least 500,000 vehicles by the end of the year.

Its main Fremont carmaking plant was shut for six weeks earlier this year due to lockdown measures during the coronavirus pandemic, putting a dampener on production numbers.

Tesla has said it plans to open a new plant in the south-west of the US as soon as the third quarter, but it has yet to announce a location.

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