Core Viewpoint - The approval of Elon Musk's proposed compensation plan at Tesla's upcoming shareholders meeting could significantly impact the company's future valuation and Musk's personal wealth, potentially making him the world's first trillionaire if Tesla's market cap reaches over $8 trillion in the next decade [1][2]. Compensation Plan Details - The proposed 2025 CEO Performance Award includes performance milestones that could lead to Tesla becoming the most valuable company in history if achieved [2]. - Musk's compensation could total $1 trillion, with shareholders also considering an alternative payment method for the estimated $56 billion owed from a previous compensation plan [3]. - The 2025 package consists of a dozen milestones, starting with a market cap of $2 trillion and requiring an additional $500 billion growth for each subsequent tranche until reaching $8.5 trillion by 2035 [4]. Performance Requirements - To earn additional stock, Musk must deliver 20 million electric vehicles, 10 million active full self-driving subscriptions, 1 million humanoid robots, and 1 million robo-taxis, along with achieving $400 billion in actual earnings for four consecutive quarters [5]. - The current market capitalization of Tesla is approximately $1 trillion, and Musk must remain vested in the company for at least seven and a half years while developing a long-term succession plan [6]. Challenges and Support - The milestones set for Musk are described as extraordinarily difficult, and achieving them would position Tesla's value close to the combined worth of Meta, Microsoft, and Alphabet [7]. - Tesla's Board Chair has indicated that a rejection of the compensation plan could result in losing Musk as CEO, emphasizing the importance of the vote [8]. Shareholder Voting Dynamics - Recent SEC filings indicated a shift in voting intentions among major investment funds regarding the compensation package, with some initially planning to vote against it but later changing their stance [12]. - Norges Bank Investment Management, Tesla's seventh-largest shareholder, announced its intention to vote against the proposed pay package due to concerns over its size and potential dilution [13][14]. - Musk, as the largest individual stockholder, has the ability to influence the vote in favor of his compensation package, raising questions about accountability [15]. Historical Context - Tesla has a history of incentive-based compensation plans, but the previous 2018 package was invalidated by a Delaware court, leading to ongoing legal battles and prompting Musk to advocate for relocating Tesla's corporate home to Texas [16][17]. - The trend of companies moving away from Delaware, influenced by Musk's actions, has been noted as a significant shift in corporate law dynamics [18].

Investor Ross Gerber, of Gerber Kawasaki Wealth and Investment Management, is calling out Tesla Inc.’s (NASDAQ:TSLA) priorities, amid reports of digital advertising campaigns being run to promote CEO Elon Musk’s controversial $900 billion compensation plan. Promoting Pay Package Despite Dwindling SalesOn Wednesday, in a post on X, Gerber said he finds it amazing that an automotive company that is currently “struggling to sell cars” is now spending money on advertising to “sell a pay package.”Gerber’s remark ...

Core Points - Tesla has introduced a new compensation package for CEO Elon Musk, which could be valued at approximately $1 trillion if specific ambitious goals are achieved over the next decade [1][2] - The primary goal of this compensation package is to increase Tesla's market capitalization from around $1 trillion to $8.5 trillion by 2035 [1][2] - The plan was detailed in an SEC filing, indicating that Musk could gain an additional 12% stake in Tesla, addressing a demand he made last year [2] Summary by Sections - **Compensation Package**: The new package for Musk could be worth around $1 trillion, contingent on meeting ambitious targets [1][2] - **Market Capitalization Goal**: The goal set for Musk is to raise Tesla's market cap to $8.5 trillion within ten years, significantly higher than its current valuation [1][2] - **Stake Increase**: The SEC filing mentions that Musk could receive an additional 12% stake in Tesla, which aligns with his previous requests [2]