Archive September 5, 2025

Elon Musk’s compensation has been approved by the electric car company’s board, which could make him the world’s first trillionaire. However, if he complies with a number of high-performance standards over the next ten years, the company’s board will approve it.

In addition to the company’s regulatory filings, the proposal went public on Friday.

One of Musk’s eye-popping pay packages from 2018 is still the subject of a legal battle because he is already regarded as one of the wealthiest businessmen in the world.

The most extensive corporate pay package in American history would likely be the latest proposal, however, if approved.

On November 6th, Tesla’s shareholders will vote on the compensation plan. A committee of independent directors had already been examining the plan, according to the regulatory filing.

“This is a incredibly large pay package. It raises a lot of questions, according to Boston College Law School professor Brian Quinn.

Quinn continued, “I have no doubts about the shareholders’ decisions.”

I believe Tesla will approve this package given that the stock price is essentially all vibes and appears to have very little to do with actual performance.

Tesla’s executives made the claim in the regulatory filing that Musk deserved a higher compensation package despite the carmaker’s recent setbacks on Wall Street.

According to the filing, “Traditional compensation packages offered to executives at other companies were deemed insufficient for designing Mr. Musk’s incentive compensation.”

What are the definitions?

Musk would have to meet lofty goals for Tesla in order to receive the trillion-dollar pay package, which would include lowering its slumping sales and increasing its overall value and car production over the course of ten years.

Musk would need to raise Tesla’s stock price to $ 2 trillion in the near future. Tesla would need to have reached an $8.6 trillion valuation by the time the plan is complete.

The company’s current assets total about $1.03 trillion, roughly the same as the proposed compensation package.

By the 10-year mark, Tesla would have delivered a total of 20 million vehicles. Just under 2 million vehicles were delivered by the business last year.

One million artificial intelligence (AI) bots will be delivered and one million self-driving robotaxis will be operational as benchmarks.

Musk would also need to create a long-term “framework” to name a successor to Tesla’s CEO as part of the 10-year plan.

Tesla shares would be used to represent all of Musk’s compensation in the proposed pay package, according to performance metrics. He wouldn’t get any bonuses or salaries.

Any shares he earns must remain with the business for at least seven and a half years in order for him to be able to cash out. He would be eligible for the entire sum if he stays until 2035, for the full ten years.

Musk currently owns roughly 13 percent of Tesla’s stock. His reach is increased by the plan by 12 percent. He would have more authority at shareholder meetings if he did that.

Compensation is subject to legal scrutiny.

Tesla has sought to make a sizable recompense for Musk’s leadership at the automaker before.

Tesla unveiled a comparable 10-year plan in 2018, which would have awarded Musk roughly $55.8 billion in stock and other awards at the time.

However, that pay arrangement has been involved in litigation after a Delaware stockholder raised the dispute. That compensation package was also voided twice because of concerns that Musk, who purportedly put his finger on the scale, might have misled it.

Tesla’s shareholders voted to reinstate the pay package in June 2024 after the company filed an appeal with the Delaware Supreme Court.

Musk’s board approved an interim compensation package worth about $29 billion in stock, with the condition that he continues to serve as CEO until 2030, as well.

Tesla moved its business incorporation from Delaware to Texas last year, according to speculation to help avoid additional legal difficulties.

In recent months, Musk himself has been subject to scrutiny because of how closely he and Donald Trump are related.

Musk’s political goals

Musk endorsed the Republican leader’s re-election campaign and poured his resources after an assassination attempt against Trump in July 2024.

Trump accepted Musk as a close advisor in return. Trump announced that Musk would lead the Department of Government Efficiency, or DOGE, a new government organization that would be akin to the dog meme Musk is associated with, shortly after winning the election in November.

Trump’s re-election came at a record high for Tesla shares last year.

However, his efforts to support far-right parties in Europe, particularly ahead of Germany’s federal election in February, were met with criticism as a result of his brief tenure as a “special government employee.”

After Musk took a leading role in the federal government’s mass layoffs and the alleged collapse of several independent agencies, including the US Agency for International Aid (USAID), protests erupted outside Tesla dealerships in the US.

Some critics questioned whether Musk might have a conflict of interest in attacking particular organizations, such as the Consumer Financial Protection Bureau, or having access to troves of government data that might be tapped to aid his businesses.

However, special government employees are only allowed to spend 130 days a year in the government.

By the time Musk and the Republican president’s term in office came to an agreement over the One Big Beautiful Bill, a massive spending bill that Trump had attempted to pass.

In a public exchange of insults, Musk threatened to launch his own rival political party, the America Party, after the bill passed in July as being fiscally irresponsible.

The tumult, as well as the rise in competition from rival electric car manufacturers, is credited with causing Tesla shares to drop 25% this year.

Sales in the European Union decreased by about 40% in July, while BYD, its Chinese rival, increased.