Tesla shareholders will decide the fate of CEO Elon Musk’s proposed $1 trillion pay package on Thursday, a historic compensation plan that could make or break his continued leadership at the company.
Under the plan, first proposed in September, Musk would be eligible to receive up to about 12% of Tesla’s stock—worth roughly $1 trillion—if the company reaches a market capitalization of $8.5 trillion and meets other operational goals over the next decade. Tesla’s current market valuation sits around $1.45 trillion, and Musk already owns about 13% of its outstanding shares.
The massive pay plan comes amid lingering legal uncertainty surrounding Musk’s previous $56 billion compensation deal, which a Delaware judge voided in January 2024. That ruling sparked fresh negotiations and shareholder concerns, prompting Tesla’s board to revisit how best to retain its high-profile CEO.
Tesla board chair Robyn Denholm has warned shareholders that failing to approve the new package could push Musk to focus more on his other ventures, including SpaceX and X (formerly Twitter).
In a letter to investors, Denholm pressed the urgency of keeping Musk engaged with Tesla’s mission, asking, “Do you want to retain Elon as Tesla’s CEO and motivate him to drive Tesla to become the leading provider of autonomous solutions and the most valuable company in the world?”
She added that without a fair, performance-based incentive, Tesla risks losing the vision and drive that have propelled the company’s success: “If we fail to foster an environment that motivates Elon to achieve great things, we run the risk that he gives up his executive position—and Tesla may lose his time, talent, and vision.”
