Tesla shareholders have approved a groundbreaking pay package for CEO Elon Musk that could reach nearly $1 trillion over the next decade. The proposal garnered more than 75 percent support during the company’s annual meeting in Austin, Texas. Musk, appearing on stage with dancing robots, conveyed a sense of optimism, stating, “What we are about to embark upon is not merely a new chapter of the future of Tesla, but a whole new book.”
The compensation package stands as the largest in corporate history and links Musk’s earnings to a series of ambitious performance and valuation milestones. These include delivering 20 million vehicles, deploying 1 million robotaxis, and achieving a market capitalisation of $8.5 trillion, a significant increase from the current $1.4 trillion. If Musk successfully meets these targets, his stake in the company could increase by up to 12 percent, allowing him to control approximately a quarter of Tesla’s shares. Notably, he will forgo a salary, with the potential to acquire more than 400 million shares under the plan, as reported by the Financial Times.
Despite the overwhelming approval, the proposal faced criticism from several quarters, including Norway’s sovereign wealth fund and proxy advisory firms Glass Lewis and ISS, who opposed the package. In defense, Tesla’s board argued that the pay structure was vital for retaining Musk, who had hinted at resigning should the vote not pass. “Other shareholder meetings are like snoozefests, but ours are bangers,” Musk told investors, underscoring his enthusiasm.
Future Ventures and Innovations
During the meeting, Musk also discussed accelerating new projects, such as the development of an autonomous humanoid robot named Optimus. He announced plans to begin production of Tesla’s steering-free Cybercab and a next-generation electric sports car, emphasizing that a “gigantic chip fab” would be necessary to support these initiatives. Musk suggested that Tesla might consider partnering with Intel to further its artificial intelligence ambitions.
According to Dan Ives, Managing Director and global head of technology research at Wedbush Securities, the pay plan establishes a foundation to retain Musk as CEO through 2030, as Tesla enters “one of the most important stages of its growth cycle.” However, concerns about the influence of Musk’s voting stake arose, with Jessica Strine, CEO of shareholder advisory firm Jasper Street Partners, noting that Musk’s approximately 15 percent voting power significantly impacted the vote’s outcome.
In addition to the pay package, shareholders approved an investment in Musk’s artificial intelligence venture, xAI, further solidifying his vision for the future of Tesla and its technological advancements. The meeting highlighted Tesla’s commitment to innovation and growth, while also framing Musk’s compensation as a pivotal element in the company’s trajectory over the next decade.
