Tesla Board Proposes ‘Mission Impossible’ $1 Trillion Pay Package for Elon Musk, Awaiting Shareholder Vote
Tesla Board Proposes ‘Mission Impossible’ $1 Trillion Pay Package for Elon Musk, Awaiting Shareholder Vote
On September 5, Tesla’s board of directors unveiled an extraordinary new long-term compensation package for CEO Elon Musk, potentially worth an unprecedented $1 trillion. This staggering proposal, if all targets are met between mid-2030 and 2035, dwarfs any previous CEO pay deal in corporate history. The announcement immediately boosted Tesla’s shares by approximately 5% at the start of trading, as investors recall Musk’s success in achieving seemingly ‘mission impossible’ goals under his 2018 compensation plan, which resulted in significant stock appreciation and tens of billions for the CEO.
However, the new plan, dubbed ‘Fantasyland’ by some, sets targets so immense that many analysts view them as highly unlikely, if not virtually impossible, to achieve, especially given Tesla’s current performance and future prospects. The compensation structure, detailed in the annual proxy statement filed on September 5, is designed to motivate Musk to achieve what the board calls ‘the most valuable company in history.’ It comes at a critical time, as a Delaware court invalidated Musk’s 2018 pay package in 2024, a decision currently under appeal by Tesla and Musk. A separate contingency plan, worth around $31 billion, was also presented in early August should the appeal fail.
The new proposal, which will now go to a vote of Tesla shareholders, mirrors the design of its 2018 predecessor. It requires Musk to unlock grants by hitting twin targets: 12 market capitalization goals, starting at $2 trillion and rising to an incredible $8.5 trillion, alongside 12 operational metrics, including putting 1 million robotaxis in circulation and selling 10 million FSD subscriptions. Achieving both a market share target and an operational metric would grant Musk an additional 1% of Tesla’s shares, potentially increasing his total ownership to his desired 25% if all 24 combined targets are met. The board asserts that Musk’s ‘voting influence is critically important to him if he is tasked with developing AI products for Tesla,’ and believes he is ‘the only person capable of leading Tesla at this critical inflection point.’
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