Elon Musk Continues Selling Tesla Shares
Tesla CEO Elon Musk has sold another 934,091 shares of the company, worth a hefty $1.01 billion, as a way to meet tax obligations related to the exercise of options to buy 2.1 million shares. But it’s just a drop in the bucket, as Mr. Musk’s offloading of Tesla stock has surpassed $10 billion overall. That’s roughly 10.1 million shares since the CEO asked Twitter users at the start of November whether or not he should dump 10 percent of his existing stake in the company following its big move to Texas.
Despite being boasting the 7th largest average income of any state, California also happens to have the highest taxation rate on wealthier individuals. Conversely, Texas imposes no state income tax or capital-gains tax on individuals rich or poor.
While Musk has previously explained that it was the enhanced scrutiny placed on the automaker during early COVID restrictions that ultimately pushed him to move the company to Austin, Texas, it’s assumed financial issues played a relevant factor. The CEO had started speaking critically of California prior to 2020’s government restrictions, going so far as to suggest he would eventually relocate its HQ to Nevada or Texas. He confirmed it would be the Lone Star State this October.
According to Bloomberg, Musk would need to dump about 17 million shares (roughly 1.7 percent of all outstanding Tesla stock) in order to reach the full 10 percent. All told, that would cut over $2 billion of his tax bill as a result of his move to Texas from California in 2020.
From Bloomberg:
Tesla shares traded 0.6 [percent] higher as of 4:45 a.m. New York time Friday, before the start of regular trading. The carmaker announced earlier this week that its headquarters had officially moved to the factory it’s been building in Austin, Texas. Musk announced the company would move its home base out of California in October.
With a $284.1 billion fortune, Musk is richer than anyone else in the world, according to the Bloomberg Billionaires Index. His wealth has surged by $128.1 billion this year as Tesla shares have soared 54 [percent].
Since November 8th, Elon has exercised options to buy 10.7 million shares while selling over 10 million Tesla shares for around $10.9 billion. He will retain the option to buy about 10 million more shares at $6.24 each, though the window closes in August of next year.
[Image: Naresh111/Shutterstock]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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A GR model with fake exhaust outlets in the back bumper? I know it's just me, but that would be enough for me to move on to something else. Why "teslafy" a perfectly fine hot hatch, Toyota???
I have a love/hate thing going for Elon, but I did love he sort of pwned his critics this way by taking billions off the table as a fake virtue signal. And I'm in the camp that thinks Tesla is like 80%+ over valued. The whole EV space is about 90% over valued. Just not that much money in car production.