🔗 Share this article

Tesla shareholders gathered this Thursday to vote on a substantial remuneration plan for CEO Elon Musk estimated at around $1 trillion. Should it pass, this deal would demonstrate market faith that the billionaire can lead the automaker into an age dominated by artificial intelligence and automation. If rejected, Tesla could risk the departure of a key figure who once made the brand equivalent with EVs.

Historic Targets and Company Valuation

Upon reaching the ambitious objectives specified in the pay package introduced at Tesla's annual meeting, he could become the first-ever trillionaire. To accomplish this, he must steer Tesla to a staggering $8.5 trillion in market capitalization, which is an eightfold increase its existing market cap. Moreover, he will be obligated to roll out millions self-driving cars and advanced androids, while upholding the company's bottom line in the massive revenue figures throughout the coming ten years.

Compensation Structure

The key aims of the remuneration structure, divided into a dozen phases, outline a trajectory for Tesla to reach its colossal worth. Should targets be met, Musk would be able to cash in an additional 12% of the firm's equity. For this to occur, he must maintain involvement with the company for at least 7.5 years. He will also help develop a long-term succession plan for the business he has led for in excess of 20 years. The share grants offered by the latest pay package, combined with shares guaranteed in his earlier deal, would result in Musk with 25% ownership of Tesla's equity. As of early November, Tesla equity was priced near its 52-week high, at around $450 each share.

Lofty Goals

Throughout a ten years, Musk will be obligated to produce 20 million zero-emission cars to buyers, market 10 million live FSD memberships, create and distribute 1 million humanoid robots, and launch 1 million self-driving cabs in paid operations.

Musk will also be obligated to bring the company to $400 billion in actual earnings for a full year. Tesla's actual earnings for the Q3 2025 were $4.2 billion, 9 percent lower from the year before.

In November, Musk's personal wealth was estimated at $460 billion, the leading in the world, as reported by market tracking.

Reviving a Revoked Deal

Stockholders are additionally evaluating a plan that would compensate Musk after his earlier remuneration deal was invalidated by a legal authority in Delaware. The pay plan, estimated to be $56 billion, was contested by a individual investor who prevailed in court. The Delaware judicial system denied Musk's compensation plan on multiple instances. If shareholders approve the proposal in the Thursday ballot, Musk is likely to be awarded the massive amount whether or not Tesla and Musk overturn the ruling of the case.

Subsequent to Musk's previous compensation plan was initially invalidated, he moved Tesla's corporate home to Texas from Delaware. He repeated the action with SpaceX and other business entities. In 2024, under Texas law, shareholders for a second time approved the pay package.

But Delaware's so-called "court of equity" once again ruled against one of the largest CEO pay deals in recent times. Following that negative decision, Musk took to social media to express dissatisfaction with the state and its "activist chief judge", arguably sparking a series of corporate exits that Delaware legislators have sought to curb with legislation.

In evaluating whether Musk had undue influence in being given that 2018 pay package, a respected legal scholar remarked that the judge acknowledged that other "celebrity leaders" like the Meta chief and Amazon's Jeff Bezos were not given this kind of incentive-based contracts.