🔗 Share this article

Investors in the electric car maker gathered this Thursday to vote on a massive compensation package for Chief Executive Elon Musk estimated at nearly $1 trillion. Should it pass, this deal would signal shareholder trust that the tech magnate can guide the automaker into an age dominated by machine learning and robotics. If denied, Tesla could potentially face the departure of a visionary leader who once made the company name synonymous with electric vehicles.

Historic Targets and Company Valuation

If the CEO meets the ambitious objectives detailed in the compensation plan revealed at Tesla's corporate assembly, he could become the first-ever person with a trillion-dollar net worth. To accomplish this, he must steer Tesla to a astronomical $8.5 trillion in market capitalization, which is an eightfold increase its existing market cap. Moreover, he will be obligated to launch numerous driverless automobiles and bipedal machines, while upholding the company's bottom line in the hundreds of billions in the upcoming decade.

Reward System

The key aims of the pay package, split into 12 tranches, outline a trajectory for Tesla to achieve its colossal worth. If successful, Musk would be in a position to realize gains on an extra 12% of the firm's equity. To qualify, he must remain vested with the firm for no less than 7.5 years. Furthermore, he is required to contribute to forming a future leadership strategy for the enterprise he has headed for over 20 years. The share grants awarded by the latest pay package, in addition to shares promised in his previous compensation plan, would grant Musk with 25 percent equity of Tesla's stock. In early November, Tesla shares were valued near its yearly maximum, at around $450 each share.

Formidable Objectives

During a decade, Musk will be obligated to deliver 20 million EVs to customers, market 10 million live FSD memberships, create and distribute 1 million humanoid robots, and introduce 1 million robotaxis in revenue-generating use.

Musk will additionally be tasked to increase the firm to $400 billion in tangible revenue for four consecutive quarters. Tesla's actual earnings for the July-September 2025 were $4.2 billion, 9 percent lower from the same period last year.

As of November, Musk's personal wealth was valued at $460 billion, the leading in the world, according to wealth indexes.

Reviving a Invalidated Deal

Shareholders are also evaluating a plan that would remunerate Musk after his previous pay package was voided by a legal authority in Delaware. The pay plan, valued at around $56 billion, was disputed by a sole shareholder who prevailed in court. The Delaware court of chancery dismissed Musk's pay package twice. Should investors pass the plan in the Thursday ballot, Musk is set to be granted the massive amount regardless of if Tesla and Musk win an appeal of the legal matter.

Following Musk's 2018 pay package was first rescinded, he relocated Tesla's corporate home to Texas from Delaware. He followed suit with the rocket firm and other business entities. In the previous year, according to Texas regulations, shareholders once again approved the remuneration deal.

But Delaware's often referred to as "equity court" again ruled against one of the most substantial CEO payouts in modern history. After that adverse judgment, Musk took to social media to show frustration with the state and its "activist chief judge", possibly igniting a series of corporate exits that Delaware legislators have sought to curb with regulatory measures.

In considering whether Musk had improper sway in being awarded that previous compensation plan, a noted law professor remarked that the judicial authority noted that other "superstar CEOs" like the Meta chief and the Amazon founder were not given this type of incentive-based contracts.