🔗 Share this article

Tesla shareholders gathered this Thursday to vote on a substantial compensation package for the company's leader estimated at nearly $1 trillion. Should it pass, this deal would showcase market faith that the billionaire can lead the car company into an era shaped by artificial intelligence and advanced machinery. If rejected, Tesla could confront the exit of a key figure who previously established the corporation equivalent with EVs.

Record-Breaking Targets and Market Capitalization

Should Musk achieve the formidable milestones specified in the remuneration deal revealed at Tesla's annual meeting, he could become the first-ever trillionaire. To accomplish this, he must guide Tesla to a monumental $8.5 trillion in market capitalization, which is an eightfold increase its current valuation. Furthermore, he will be tasked to launch millions self-driving cars and advanced androids, while sustaining the corporate profits in the hundreds of billions over the next decade.

Payment Breakdown

The key aims of the compensation plan, split into twelve stages, chart a path for Tesla to attain its enormous market capitalization. If successful, Musk would be in a position to realize gains on an further 12% of the company's stock. To be eligible, he must remain vested with the corporation for at least 7.5 years. Additionally, he must assist in creating a long-term succession plan for the business he has managed for over 20 years. The stock options awarded by the updated remuneration deal, combined with shares promised in his previous compensation plan, would grant Musk with 25 percent equity of Tesla's stock. As of early November, Tesla shares were valued approaching its 52-week high, at roughly $450 each share.

Ambitious Targets

Throughout a decade, Musk will be obligated to manufacture 20 million EVs to customers, market 10 million active full self-driving subscriptions, develop and sell 1 million bipedal machines, and launch 1 million self-driving cabs in paid operations.

Musk will additionally be required to elevate the firm to $400 billion in real profits for four consecutive quarters. Tesla's real profits for the third quarter of 2025 were $4.2 billion, down 9% from the year before.

In November, Musk's net worth was estimated at $460 billion, the leading in the world, according to wealth indexes.

Reviving a Revoked Deal

Shareholders are also evaluating a arrangement that would compensate Musk after his previous pay package was invalidated by a court in Delaware. The remuneration deal, valued at around $56 billion, was contested by a individual investor who won his case. The state court dismissed Musk's pay package twice. Upon stockholder approval the plan in the Thursday ballot, Musk is set to be awarded the substantial payout irrespective of whether Tesla and Musk overturn the ruling of the legal matter.

After Musk's previous compensation plan was first rescinded, he relocated Tesla's legal headquarters to Texas from Delaware. He followed suit with SpaceX and other companies' headquarters. In last year, under Texas law, shareholders again voted to approve the compensation plan.

But Delaware's known as "court of equity" for a second time ruled against one of the biggest CEO payouts in modern history. After that unfavorable ruling, Musk posted on his accounts to voice displeasure with the region and its "influential presiding justice", possibly igniting a wave of business departures that Delaware legislators have sought to curb with regulatory measures.

In evaluating whether Musk had undue influence in being given that previous compensation plan, a noted legal scholar commented that the court noted that other "celebrity leaders" like Facebook's founder and Amazon's Jeff Bezos were not given this type of performance-linked deals.