Tesla shareholders have overwhelmingly approved a groundbreaking pay package for CEO Elon Musk, potentially worth nearly $1 trillion over the next decade. The proposal received support from more than 75 percent of shareholders during the company’s annual meeting held in Austin, Texas. This unprecedented package is dependent on Musk achieving a series of ambitious performance milestones, including the delivery of 20 million vehicles and deploying 1 million robotaxis, as well as raising Tesla’s market capitalisation to $8.5 trillion, up from its current $1.4 trillion.
Musk addressed investors during the meeting, accompanied by dancing robots, and stated, “What we are about to embark upon is not merely a new chapter of the future of Tesla, but a whole new book.” His compensation plan is structured around performance and valuation targets, and if Musk meets all the criteria, his stake in Tesla could increase by up to 12 percent, granting him control of approximately a quarter of the company’s shares. Notably, Musk will not draw a base salary but could receive more than 400 million shares as part of the arrangement, according to a report from the Financial Times.
Despite the overwhelming approval, the pay package faced opposition from critics, including Norway’s sovereign wealth fund and advisory firms Glass Lewis and ISS. In defense of the proposal, Tesla’s board argued that retaining Musk was vital for the company’s future, especially since he had indicated he might step down if the vote did not pass. Musk remarked, “Other shareholder meetings are like snoozefests, but ours are bangers,” highlighting the excitement surrounding Tesla’s future prospects.
Future Projects and Technological Innovations
In addition to the pay package, Musk outlined plans for accelerated technological advancements at Tesla. He emphasized the development of an autonomous humanoid robot named Optimus, along with the forthcoming production of Tesla’s steering-free Cybercab and a next-generation electric sports car. Musk noted that to support these ambitious AI initiatives, the company may require “a gigantic chip fab” and suggested potential partnerships with Intel.
Dan Ives, Managing Director and global head of technology research at Wedbush Securities, commented that the new pay plan is crucial for ensuring Musk’s leadership through 2030, as Tesla enters a pivotal phase in its growth cycle. Meanwhile, Jessica Strine, CEO of shareholder advisory firm Jasper Street Partners, indicated that Musk’s significant 15 percent voting stake likely influenced the favorable outcome of the vote.
During the same shareholder meeting, investors also approved funding for Musk’s AI venture, xAI, further expanding the company’s technological reach and ambitions. The endorsement of the pay package and the commitment to new projects signal a determined effort by Tesla to maintain its competitive edge in the rapidly evolving automotive and technology sectors.
