Tesla woes following fatal crash dent Elon Musk's fortune and chance at US$2.6 billion share options
A decline is fuelled by a fatal crash of a Model X car, a recall of about 123,000 Model S vehicles and a credit-rating downgrade
One of the worst weeks in Tesla’s 15-year-history has sapped Elon Musk’s net worth and made the moon-shot goals underlying his US$2.6 billion award of share options seem all the more audacious.
The stock price of the electric carmaker has tumbled about 20 per cent since Musk’s record grant of options was approved by investors on March 21.
The decline has been fuelled by a fatal crash of a Model X car, a recall of about 123,000 Model S vehicles and a credit-rating downgrade.
That has dimmed the outlook for the chief executive officer to collect any of the options, which will vest in 12 increments if goals tied to market value and either revenue or earnings excluding certain items are met.
The market-value hurdles start at US$100 billion and increase in US$50 billion increments.
Tesla’s market capitalisation fell to about US$42.6 billion on Monday as shares continued to slide, cutting roughly US$400 million off Musk’s net worth.
He has lost about US$1.9 billion this year, according to the Bloomberg Billionaires Index.
But neither Tesla nor Musk are bankrupt yet.
Musk remains one of the world’s richest people with his US$18.1 billion fortune, and has a full decade to achieve the goals that would trigger vesting of his options.