• Tesla's board seeks shareholder approval for a new compensation package for CEO Elon Musk, which could be worth over $1 trillion if ambitious milestones are met.
  • The proposal comes after a Delaware judge revoked Musk's previous $56 billion pay package and is designed to secure his long-term commitment.
  • A core condition of the deal is an increase in Musk's voting control over the company, centralizing decision-making as Tesla navigates a pivotal transition.

Tesla Chair Robyn Denholm has made it clear that securing Elon Musk’s focus and leadership through the next decade is paramount, and that increased voting rights are a non-negotiable part of the equation. This comes as the board asks shareholders to approve a new, unprecedented compensation package for the CEO that could ultimately be worth over $1 trillion.

The proposal, detailed in a recent filing, is a direct response to the revocation of Musk’s previous $56 billion pay award by a Delaware judge. The board argues the new package is essential to keep Musk dedicated to Tesla as it faces a complex period marked by its first annual sales decline in over a decade, intensifying global EV competition, and a strategic pivot toward autonomy and robotics.

“Elon has made it clear that his level of control over the company’s direction is a key factor in his continued involvement,” a person familiar with the board’s thinking said. The proposed deal would significantly increase his voting power, further centralizing major strategic decisions with the CEO.

The ambitious milestones tied to the pay are staggering, targeting a growth in market valuation that would see Tesla reach a $7.5 trillion market cap. Targets include the production of 20 million vehicles, the deployment of 1 million robotaxis, and the creation of 1 million humanoid robots—goals many analysts view as extremely aspirational.

The push comes at a delicate time for the automaker. Tesla’s most recent quarterly profit plummeted from nearly $1.4 billion a year ago to $409 million, with revenues falling in tandem. The company is grappling with a consumer backlash partly linked to Musk’s polarizing political statements, which some reports suggest have driven a number of potential buyers to competing brands.

Despite the recent slump in its stock price this year, Tesla shares are still up 54% over the past 12 months, reflecting the volatile but potent investor faith in Musk’s long-term vision. The board is betting that same faith will extend to this new pay package, framing it as a necessary gamble to ensure the CEO shepherds the company through its next transformative phase.

If shareholders do not approve the package, the board has warned that Musk’s commitment cannot be assured, potentially forcing him to divert more attention to his other ventures, such as xAI and SpaceX. The shareholder vote is expected to be a closely watched referendum on Musk’s leadership and the company’s high-stakes future.