Tesla shareholders have overwhelmingly approved a massive compensation package for CEO Elon Musk, which could be worth up to $1 trillion. The decision was announced during the company’s meeting held at its Austin, Texas factory. More than 75% of participating shareholders voted in favor of the plan.
The proposed payment package does not mean Musk will immediately receive $1 trillion or a salary. Instead, the package is divided into 12 tranches, granting Musk stock options worth hundreds of billions of dollars only if Tesla meets ambitious targets for operations, profit, and market capitalization. For example, Tesla—currently valued at around $1.5 trillion—must reach a market capitalization of $8.5 trillion within the next decade.
The vote followed a two-month intensive campaign by Tesla’s management and board of directors. The company even resorted to using rare television advertisements to urge shareholders to approve the plan. Board Chair Robyn Denholm called the approval a “critical moment” for Tesla.
Musk, meanwhile, explained that his push for shareholder approval stemmed from his desire to increase his voting control over Tesla to 25%. He currently owns about 15% of the company’s shares, and said the higher stake would prevent him from being ousted or losing control over the future ‘robot army’ Tesla aims to develop.
This new package comes after a Delaware Chancery Court struck down Musk’s 2018 compensation plan—then valued at $56 billion—citing a lack of transparency in the negotiation process. Tesla has since appealed that decision.
