Tesla shareholders have approved a pay package for Elon Musk that could potentially make him the world’s first trillionaire, contingent on several ambitious targets. In a vote held on Thursday, a significant 75% of shareholders backed the compensation plan valued at upwards of $1 trillion for the Tesla CEO. This plan necessitates that Musk meets a series of strategic business goals set for the company, including elevating Tesla’s market capitalization to $8.5 trillion by 2035.
Under the terms of the agreement, Musk, who currently holds the title of the wealthiest individual globally with an estimated net worth of about $461 billion, will not receive immediate financial compensation. His potential earnings hinge on achieving specific milestones such as selling 12 million vehicles annually and deploying a million units each of robotaxis and humanoid robots.
Moreover, Musk must remain in the role of Tesla CEO for at least seven and a half years to qualify for any shares provided by this new pay structure. Interestingly, the agreement also allows him to continue serving as CEO of his other ventures, including SpaceX and his artificial intelligence company, xAI.
Following the shareholders’ decision, Musk expressed his gratitude during a spirited shareholders’ meeting in Austin, Texas. Celebrating the approval alongside a display of robots, he conveyed his vision for Tesla’s future, stating, “What we’re about to embark upon is not merely a new chapter on the future of Tesla but a whole new book.”
The pay package has attracted scrutiny and debate. Norway’s sovereign wealth fund, which holds shares in Tesla, raised concerns about the impact of the new shares on existing shareholders. They emphasized the potential dilution and voiced apprehensions regarding the overall size of Musk’s compensation package, highlighting the need for better risk mitigation associated with key personnel.
Despite his wealth, Musk’s journey has not been free from controversy, particularly regarding his political views and management decisions. Earlier this year, protests erupted outside Tesla showrooms, challenging his stance on government budget cuts and other right-leaning policies.
Nonetheless, Musk and Tesla executives have been transparent about their ambitious plans to develop advanced robotics. These innovations are envisioned to function as household assistants and self-driving transport solutions, although such products remain unreleased to the public as of now.
