Tesla shareholders have approved a massive new pay deal for CEO Elon Musk, potentially worth around $1 trillion if the company hits ambitious targets over the next decade.
Roughly 75% of investors backed the package during Tesla’s annual meeting in Austin, Texas. The vote came after months of debate over Musk’s compensation, which some argued was excessive but which the board said was essential to keep him leading the company.
Elon Musk celebrated on stage to chants of his name, calling the meeting a “banger” and telling shareholders that Tesla was starting “a whole new book” as it moves into its next phase.
The world’s richest man said, “Other shareholder meetings are snoozefests, but ours are bangers. Look at this. This is sick.”
How will Musk get the $1 trillion?
Under the deal, Musk won’t receive a salary. Instead, he could be granted more than 400 million Tesla shares if he achieves a set of major milestones. These include producing 20 million vehicles, launching one million self-driving robotaxis, securing 10 million Full Self-Driving subscriptions, and raising Tesla’s total market value to $8.5 trillion, up from about $1.4 trillion today.
The new pay package replaces an earlier 2018 deal that was struck down by a Delaware court, which ruled Tesla’s board was too close to Musk. The company has since moved its incorporation to Texas, and the vote to approve the new deal took place there.
Some of the world’s largest investors, including Norway’s sovereign wealth fund and CalPERS, voted against the plan. However, the large number retail shareholders in the company helped secure the approval.
Tesla’s stock has risen more than 60% in the past six months, currently at around $448 per share. However, it still hasn’t reclaimed it’s all-time high of over $700 per share, in 2020.
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