On the Dash:
- Musk’s $1 trillion pay plan received 75% shareholder support.
- The plan ties stock awards to Tesla’s market value and operational goals.
- Musk’s 2018 pay package remains under legal review in Delaware.
Tesla shareholders have approved CEO Elon Musk’s historic compensation plan, with 75% of voting shares in favor. The announcement came Thursday at the company’s annual meeting in Austin, Texas.
Introduced in September, the plan gives Musk 12 tranches of Tesla stock if the company meets aggressive financial and operational milestones over the next decade. Ownership could grow from roughly 13% to 25%, adding over 423 million shares. The first tranche is triggered when Tesla’s market capitalization hits $2 trillion, up from its current $1.54 trillion value.
Subsequent tranches reward incremental market value gains of $500 billion, rising to $6.5 trillion, with the final two tied to $1 trillion increases, requiring an $8.5 trillion market cap. Operational targets are equally ambitious. Tesla must achieve $50 billion in annual adjusted profit initially, scaling to $400 billion, along with 20 million annual vehicle deliveries, 10 million active Full Self-Driving subscriptions, and one million Optimus humanoid robots and robotaxis in commercial operation.
The vote follows a legal setback. A Delaware court previously ruled Musk’s 2018 pay plan was improperly granted. The matter is now under appeal in the Delaware Supreme Court. Despite that, Tesla’s board recommended approval, citing Musk’s central role in the company’s growth and long-term vision. Proxy advisors Glass Lewis and ISS had opposed the plan.
Shareholders also considered a proposal allowing Tesla to invest in Musk’s AI startup, xAI. While more votes were cast in favor than against, several abstentions mean the company is reviewing next steps.
The approved plan places no limits on Musk’s political activities and does not mandate a minimum time commitment to Tesla. Musk continues to lead multiple ventures, including SpaceX, Neuralink, and The Boring Company, while also pursuing his ambitious AI and robotics projects.
