Tesla(US:TSLA) Hua Er Jie Jian Wen·2025-10-28 13:13Core Viewpoint - Tesla's future is closely tied to Elon Musk's potential departure, which could significantly impact the company if shareholders reject his proposed compensation plan valued at up to $1 trillion [1][2]. Group 1: Compensation Proposal - The new compensation proposal for Musk is facing substantial opposition, with major proxy advisory firms Glass Lewis and ISS recommending shareholders vote against it [2]. - A coalition of large pension funds has publicly opposed the plan, criticizing the board for pursuing excessive compensation to retain Musk, which they believe has harmed Tesla's reputation [2]. - The proposed compensation includes 12 tranches of performance-based restricted stock, contingent on achieving ambitious targets such as increasing the company's valuation to $8.5 trillion and achieving a 24-fold profit growth [3]. Group 2: Leadership Concerns - Tesla's chairwoman, Robyn Denholm, emphasized that there is no "Plan B" if Musk were to leave, stating that no one can replace him [4]. - Denholm acknowledged that the board is aware of the negative implications for shareholders if the vote fails, but she does not believe Musk would take any sudden destructive actions [4]. - The board has explored alternatives to provide Musk with voting rights without excessive financial compensation but found no viable options, leading to the current proposal involving restricted stock [5]. Group 3: Financial Context - Musk's wealth is closely linked to Tesla's stock price, which has more than doubled over the past five years, reaching a market capitalization of $1.4 trillion [5]. - Musk holds approximately 15% of Tesla's shares and has used them as collateral to raise billions for other ventures, including the acquisition of social media platform X and the development of AI startup xAI [5]. - The upcoming shareholder meeting will not only address the compensation proposal but also vote on the re-election of three board members and whether Tesla should invest in xAI, marking a critical trust vote on Musk's leadership [5].