Tesla Shares Plummet 6.10% Amidst China Sales Drop and Unique Compensation Spotlight
1min read On November 12, Tesla's stock experienced a notable decline, dropping 6.10%. This downturn followed a previous trading session where Tesla's shares initially showed strength but later fell over 4% intraday. By 23:35, the stock had decreased by 2.28%, closing at $342.035 per share. This volatility in Tesla's stock price reflects broader market movements and ongoing challenges within the company.
Recent data reveals a sharp decline in Tesla's sales in China for October. The company's retail sales in China saw a substantial drop of 43.9% month-over-month, causing Tesla to fall from the previous month’s fourth place to seventh. The significant drop is attributed to Tesla's strategy of allocating a major portion of its Model Y and Model 3 production for export rather than the domestic market, leading to a decreased supply and, consequently, lower sales figures in the region.
Tesla's unique compensation strategy has also been in the spotlight. Known for its distinctive structure, Tesla offers a lower base salary than the industry average but compensates with substantial stock options. This approach is designed to attract candidates willing to trade high initial salaries for potential future gains. Data suggests that Tesla's median base pay for approximately 13,000 full-time salaried employees in the U.S. is significantly lower than that of other tech giants and traditional automakers. For instance, Tesla’s median pay is about $40,000, contrasting sharply with companies like Meta, where median pay reaches $379,000.
This high-risk, high-reward compensation model is coupled with a rigorous recruitment process intended to select employees committed to the company's long-term objectives. While this strategy effectively retains loyal employees willing to endure short-term sacrifices, it also eliminates those seeking immediate financial benefits. Some employees have indeed reaped considerable rewards during periods of stock market growth, benefiting from Tesla's performance-based incentives.