SAN FRANCISCO: Tesla shareholders are set to vote Thursday on a historic $878 billion compensation package for CEO Elon Musk the largest executive payout ever proposed. The decision, to be made during the company’s annual general meeting in Austin, Texas, could redefine not only Musk’s future with Tesla but also the company’s direction in artificial intelligence and corporate governance.
If approved, the pay package would signal investor confidence in Musk’s leadership and his ambitious goal to transform Tesla into a global leader in AI and robotics. However, a rejection could spark internal turmoil and questions about Tesla’s long-term strategy.
The proposed plan links Musk’s payout to steep performance targets including producing 20 million vehicles in a decade, deploying a million robotaxis, and pushing Tesla’s market valuation beyond $8.5 trillion. The company’s current worth is estimated at over $1.5 trillion.
While Musk’s roughly 15% stake makes passage likely, several major investors, including Norway’s sovereign wealth fund and proxy advisory firms, have criticized the package as “excessive.” Tesla’s board has warned that Musk might step back if the deal is rejected.
In addition to Musk’s compensation, shareholders will vote on whether Tesla should invest in Musk’s separate AI venture, xAI. The idea, supported by Musk but not officially endorsed by Tesla’s board, has raised concerns over potential conflicts of interest between his multiple companies.
Another key proposal aims to eliminate Tesla’s supermajority voting rule, replacing it with a simple majority system. Previous attempts in 2019, 2021, and 2022 failed to gain the required two-thirds approval. Some investors fear this change could further consolidate Musk’s control over the company.
The outcome of Thursday’s vote will not only determine Musk’s personal fortune but also shape the future governance and innovation trajectory of one of the world’s most influential technology firms.
