Tesla investors approved an incentive package on Wednesday that could ultimately net CEO Elon Musk around $56 billion. There is a catch, however. He has to elevate the company’s share price to almost comically high levels. Having already covered the deal, we noted some opposition from analysts, but not shareholders — all of whom seem overwhelmingly happy to oblige Musk if he improves their wealth, as well.

Investment advisor Glass Lewis & Co. said offering the CEO an additional 12 percent in stock options (currently valued at around $2.6 billion) was unnecessary since he is already a major shareholder and the move could dilute value for other investors. But most agreed Musk was too important to risk losing and agreed to the package to keep him in charge of the company, despite Musk stating this was his intent all along. (Read More…)

Tesla Motors previously announced that its CEO, Elon Musk, wouldn’t be paid unless its already high stock valuation continued to climb. His compensation package — valued at roughly $2.6 billion — is tied to a dozen operational milestones, all of them primarily linked to the company’s share price. However, the board has left the strategy’s fate in the hands of its shareholders, who will vote on the motion come March 21st.

In addition to Musk’s existing stock options, that bonus could result in a total payday of more than $55.8 billion over the next decade. That’s too much, according to proxy advisor Glass Lewis & Co. With the CEO already so finically invested in the company, Glass Lewis doesn’t believe any fee would have a meaningful impact on Musks’ involvement. He already owns at least 20 percent of Tesla’s stock, so any improvement in its valuation would already benefit him immensely.

“Any relative comparison of the grant’s size would be akin to stacking nickels against dollars,” Glass Lewis & Co. said in a report from February.  (Read More…)

Patience, as we’ve been told, is a virtue. Therefore, the most virtuous individuals occupying the ball of mud we call Earth must be the Tesla faithful currently awaiting their pre-ordered Model 3 sedans. The speed of the vehicle’s launch has been sedate, to say the least. Tesla Motors finds itself plagued by production bottlenecks, which hasn’t helped the already long wait times facing those who dropped a sizable wad of bills just for the privilege of eventually owning its latest model.

However, the lengthy intermission between launch and ownership doesn’t appear to be diminishing their love for the company — a testament to the brand’s difficult-to-tarnish image. Fans of the automaker seem content to wait it out in tranquility like Siddhartha Gautama under the tree of enlightenment.  (Read More…)

“Ford’s future is not about giving up the car,” Jim Hackett, Ford chief executive officer, exclaimed at the Michigan CEO Summit in Detroit on Thursday. But he promises there will be “no dumb cars in the future.”

The executive was not assuring attendees that Ford has no plans to revive the Mustang II, rather, he was talking about the brand’s continued efforts to press onward into the development of electric, connected, and self-driving automobiles on a global scale. With Wall Street still fixated on tech, it would be surprising to hear any automotive executive say otherwise.   (Read More…)

“Mobility” is easily the most overused term in today’s automotive vernacular. Despite being incredibly nonspecific, executives can’t help but make it the bookend of most speeches involving long-term goals and production stratagems. But why?

The term itself pertains more to the industry itself than the specific products it’s developing. While “mobility” can be applied to any conveyance with a technological bent, the word also represents a company’s ability to move into other areas of business. And that’s what gets the investors and market analysts tugging at their collective collar, damp across the brow, so red hot they can’t help but raise the stock valuation of any company that seems poised to make a big move.

Tesla’s entry as novel manufacturer with a unique product was enough to send its share price through the roof, and established automakers took notice. Despite Mark Fields’ best attempt to rebrand Ford as a tech company, he couldn’t bottle that same lightning and paid the ultimate price — getting fired. However, General Motors may be succeeding where Ford initially failed. The proof of the pudding is how high its share prices continue to climb.  (Read More…)

Tesla Motors launched the Model 3 last month and has been scrambling to improve production volume as over 500,000 eagerly await delivery. However, by the time Tesla hits its targeted production rate of 10,000 units per week in 2018, it is still going to have months — if not a full year — of orders sizzling on the back burner.

It’s not the worst problem to have, since each reservation holder tossed down a $1,000 deposit. But CEO Elon Musk is aware that meeting demand is going to be an uphill battle. “We’re going to go through at least six months of manufacturing hell,” Musk told the press ahead of Model 3 launch event.

With the company already having spent over $2 billion in capital this year, restocking the safe is probably a good idea. As an upstart automaker framing itself as going into battle with traditional manufacturers, Tesla is issuing $1.5 billion in junky war bonds to fund the coming onslaught.  (Read More…)

Prior to this morning’s announcement that outgoing Ford Motor Company CEO Mark Fields is “retiring,” Fields was in charge at the Blue Oval for nearly three years. Just a little more than ten quarters, to be more precise.

In eight of those quarters, Ford Motor Company U.S. market share declined, year-over-year.

Ford was not without excuse, of course. There was always market share to be taken if Ford wanted it. But an attempt to limit reliance on daily rental fleet sales, particularly with Ford’s passenger car division, did the automaker’s market share no favors. Ford’s transition from old F-150 to the new aluminum-bodied model was a major switch, too, and sales growth during the transition phase wasn’t easy to come by.

Nevertheless, Ford’s U.S. market share didn’t nosedive during the Mark Fields era. The burden on incoming CEO Jim Hackett’s shoulders won’t be the elevation of Ford Motor Company market share in the automaker’s home market.

No, it’s the price of a Ford share that matters right now. (Read More…)

As anticipated, Ford CEO Mark Fields was grilled today over his plans to improve the company’s waning fortunes by board members who had scheduled extra time to question him.

Hot topics at the annual meeting centered on why profits are falling, what is Ford doing about the market shift toward SUVs, and how the company’s colossal investments into technology are affecting its present-day financial situation. Ford has poured billions into self-driving vehicles and ride-sharing platforms as its traditional car business loses some ground to General Motors in a slowing U.S. market. Fields spearheaded Ford’s rebranding as a mobility company, but many have suggested this future-focus isn’t healthy for the brand.

Fields stuck to his guns, emphasizing that Ford was heading “aggressively but also prudently” into “the biggest strategic shift in the history of our company.”  (Read More…)

(Caveat: I know nothing at all about stocks, bonds or other financial instruments.)

After automotive startup Elio Motors raised approximately $17 million dollars in a Reg-A+ stock offering the company crowdsourced from small investors via StartEngine, it said its shares would be listed on the OTCQX exchange to provide those investors with liquidity.

It’s probably too early to call Elio another Tesla (whose own market capitalization probably exceeds its actual value), and I don’t know how many of those investors are going to sell their stock so soon. But, if they did, they would have more than doubled their money in less than two weeks as of Monday’s close. (Read More…)

Morgan Stanley analyst Adam Jonas issued a lower target for Tesla on Wednesday, saying the automaker’s SUV price tag is too hefty for the carmaker to meet its production volume goal for 2016.

Jonas wrote that the $130,000 SUV is just too pricey (via Business Insider):

Even allowing the Model X (average transaction price) to decline over time through the introduction of lower-spec models leaves what we believe to be a higher-priced vehicle than we expected that may struggle to meet the volume expectations of the market and our forecasts.

If you remember correctly, Jonas was the analyst that called for Tesla’s stock to effectively double because he had a good idea for the automaker, which he said was the world’s most important.

(Read More…)

Shortly after GM’s bankruptcy, we wondered why so many people were still trading “old GM” stock. After all, old GM stock is in a liquidation company with no chance of ever emerging from bankruptcy.  In order to clear up any confusion, the SEC forced GM Liquidation (then GMGMQ) to change its ticker to MTLQQ. Apparently that didn’t work. CNN Money reports:

On Jan. 11, the first day of the big auto show in Detroit, about 41.6 million shares of MTLQQ exchanged hands. To put that in perspective, that’s more than the volume of Apple (AAPL, Fortune 500), Google (GOOG, Fortune 500) and IBM (IBM, Fortune 500) combined that day.

Holy fiduciary responsibility, Batman! The report goes on to note that MTLQQ is the ninth most-researched stock of 2010 at CNN Money, beating stocks like Microsoft and ExxonMobile. TTAC has expressed skepticism in the past about GM’s forthcoming IPO on silly grounds like the firm’s lack of profit, turmoil in overseas divisions, weak sales and questionable strategy. Frankly, this news makes us question whether any of these things matter. If a 70 cent (but worthless) stock in a company that has no bearing on New GM can rack up that kind of trading volume, clearly there are some unfathomable dynamics at play. Maybe a $60b GM IPO market cap is possible after all!