Tesla Proposes Record $1 Trillion Pay Package for CEO Elon Musk

Tesla's board has unveiled a colossal proposed compensation plan for CEO Elon Musk that could be worth up to $1 trillion, representing what would be the . The move, which sent Tesla shares climbing over 3%, underscores the board's extraordinary efforts to retain and incentivize its visionary, yet controversial, leader as the company navigates a critical pivot towards artificial intelligence and robotics.

The groundbreaking proposal would grant Musk up to 12% of Tesla's stock over a ten-year period, but it is contingent on the company achieving a series of lofty targets. The primary goal is a staggering $8.6 trillion market capitalization—a nearly eightfold increase from its current valuation. The plan also includes ambitious operational milestones, such as delivering 20 million vehicles by 2035 and launching a commercial fleet of one million robotaxis.

In a letter to investors, Tesla Chair Robyn Denholm stated that "retaining and incentivizing Elon is fundamental to Tesla achieving these goals and becoming the most valuable company in history." The board argues that Musk's leadership is indispensable as the company expands beyond electric vehicles into more futuristic endeavors. The plan is structured so that Musk receives no salary or cash bonuses; his entire compensation is tied directly to performance, echoing the structure of his now-contested 2018 pay package.

This new proposal comes after a Delaware court voided Musk’s previous $56 billion package earlier this year, citing governance concerns. In response, Tesla has since reincorporated in Texas. The new plan will be put to a , reigniting debates around corporate governance and the scale of executive pay. While critics argue the award is excessive and poses risks of shareholder dilution, the market's initial reaction was positive, reflecting investor confidence in Musk's ability to deliver unprecedented growth.