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Tesla is asking shareholders to approve an unprecedented $975 billion compensation plan for CEO Elon Musk↳, a move that could dramatically increase his voting power and stake in the company. The proposal, disclosed Friday in a regulatory filing, would grant Musk 423 million additional shares if Tesla achieves a series of ambitious market and operational milestones over the next decade.
The plan includes 12 tranches of stock awards, each tied to specific targets. To unlock the first payout, Tesla must nearly double its current market value to $2 trillion. The final milestone would require the company to hit a staggering $8.5 trillion market cap, almost eight times its present valuation. Operational goals include producing 20 million vehicles annually, deploying 1 million robotaxis, and delivering 1 million humanoid robots.
Tesla Chairwoman Robyn Denholm told CNBC the plan was designed to keep Musk "motivated and focused," emphasizing that no minimum time commitment would be required from him. Musk currently holds about 13% of Tesla's shares, but this new package could significantly boost his control.
The proposal comes as Tesla grapples with slowing EV demand and intensifying competition from rivals like China's BYD. The company is also shifting its focus toward ↳AI and robotics, positioning itself as a leader in emerging technologies. Tesla will additionally ask shareholders to vote on whether the company should invest $5 billion in Musk's AI startup, xAI, which recently merged with his social platform, X, and operates a massive data center in Memphis.
This move follows a Delaware court ruling last year that invalidated Musk's 2018 pay plan, valued at $56 billion, citing improper negotiations and lack of shareholder transparency. Tesla has since ↳relocated its incorporation to Texas and is appealing the decision.
Supporters argue the new plan aligns Musk's incentives with Tesla's long-term growth, while critics warn of potential governance issues and shareholder dilution. Despite controversy, Tesla shares rose 4% Friday on news of the proposal.
If approved, the package would be the largest corporate pay deal in history, cementing Musk's influence as Tesla pushes to become the world's most valuable company while transforming into a global AI and robotics powerhouse.
