Tesla offers Elon Musk staggering pay package that could reach $1 trillion

Core Insights - Tesla has introduced a new pay package for CEO Elon Musk that could potentially reach $1 trillion, contingent on achieving specific milestones [1][5] - The plan aims to increase Tesla's market value to $8.5 trillion, which is more than eight times its current valuation of approximately $1.09 trillion [2][9] - Musk's compensation is tied to ambitious targets in vehicle sales, robotaxi deployment, and artificial intelligence advancements [5][11] Compensation Structure - The new pay package includes a base grant valued at $87.8 billion, which could escalate to $1 trillion if all performance benchmarks are met [5] - If Musk achieves the outlined goals, his ownership stake in Tesla could rise to at least 25%, granting him about 29% voting control [3][11] - The plan is designed to retain Musk's leadership, which the board believes is crucial for Tesla's future success [3] Legal Context - This new compensation plan follows a Delaware court ruling that invalidated Musk's previous $56 billion pay package, citing conflicts of interest and lack of proper shareholder information [4] - Tesla is currently appealing this decision, with oral arguments scheduled for October 15 [5] Market Performance - Tesla's vehicle deliveries have declined by 13% in the first half of the year, marking one of the company's worst performances in recent years [11] - Despite a 1.9% increase in share price recently, Tesla's stock is down 16% year-to-date, having peaked at a valuation of $1.5 trillion in late 2024 [12] Future Prospects - The shareholder vote on Musk's new compensation package is set for Tesla's annual meeting in November, and if approved, it would represent the largest payout ever awarded to a corporate executive [12] - The board has also proposed considering a stake in Musk's AI startup, xAI, which aligns with Musk's interests in expanding Tesla's technological capabilities [7]