Internal documents circulated at Tesla show's that its implementing cash based compensation vs the standard equity based compensation.
There's probably 2 trains of thought here as to why this would make sense;
- Tesla has an increasingly large cash balance at $19billion, and in today's economy with a recession, volatile markets and global unrest, cash is king.
- Issuing stock to employees when some might view it as receiving stock on an inflated valuation could impact the very nature of using it as an incentive.
I think most would argue that equity outweighs cash when it comes to aligned incentives but if you can achieve the same results with no dilution then that wold be the best outcome.
As reported by The Information, Tesla's stock has appreciated from a low of $30 at the start of 2020, to $268.21 on a split-adjusted basis on Thursday.