Publications Business Insider gained access to Tesla’s internal database with information on the salaries of about 100,000 employees.
The data, however, is somewhat outdated (from December 2021), but it allows us to compare it with the level of salaries of competitors at the same time. The highlights: Tesla offers employees a lower base salary than other companies in the automotive industry, but provides grants for future stock options.
How much do competitors pay?
Based on data from the Securities and Exchange Commission, BI compared Tesla’s average base salary to that of other automakers and the six largest tech companies by market capitalization.
In fact, Elon Musk’s company lags behind all but Amazon — while there are a number of factors that can affect average salaries, the data is consistent with what four current and former Tesla employees say: base salaries at the company are generally lower than competitors.
The way to a million
In general, both current and former Tesla employees say that stock grants make it easier to accept lower base salaries. In November, after Trump’s re-election as president, the automaker’s shares rose by about 8%, bringing the company’s market capitalization to $1 trillion. At the same time, over the past 5 years, Tesla shares have generally risen by more than 1000%.
According to BI, in 2020 and 2021, 44 Tesla employees in the US were offered shares worth more than $1 million.
«We give everyone stock options. We have made many people who didn’t even know what stocks were millionaires,» Elon Musk said last year.
Tesla is not the first company to increase base salaries through equity grants – Meta, Google, and Amazon use a similar system. However, this year’s Levels.fyi survey showed that the average base pay and equity grants for Tesla’s American software engineers are slightly lower than those of the above companies.
BI went on to provide more specific data on the top executives’ stock grants: Drew Baglino, Tesla’s former senior vice president of powertrain and energy engineering, and Zachary Kirkhorn, former CFO, each received $20 million in stock; while right hand man of Musa Omead Afshar received shares worth $10 million.
«That’s part of the rewards of taking risks with a company like Tesla», — says one of the company’s engineers. «You may have to face the challenges of a startup — long hours, some uncertainty — but it can also bring significant rewards».
Hiring strategy
In an interview with the publication, one of the employees said that the main criterion for hiring specialists for Elon Musk remained unchanged — manic love of work and willingness to give up everything for it (remember how he encourages employees to spend the night in the office)
«The whole system is set up to find fanatics», — says a Tesla employee. «People could get a higher salary elsewhere, but they are obsessed with Tesla».
Meanwhile, a former recruiter who worked for the company until 2024 says that the interview process involves at least nine interviews and can last for months — another way to select real fanatics for the company.
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