Core Points - Tesla shareholders approved a $1 trillion pay package for Elon Musk, the largest on record, which could potentially make him the world's first trillionaire if performance targets are met over the next decade [1][2] - The compensation plan requires Musk to achieve specific benchmarks, including a $2 trillion valuation and the delivery of 20 million vehicles, as well as a $3 trillion market cap and 1 million humanoid robots [2][3] - Over 75% of shareholders voted in favor of the proposal, indicating strong confidence in Musk's leadership despite recent stock performance challenges [4][11] Compensation Structure - Musk's compensation will be awarded in 12 tranches, with significant payouts tied to ambitious performance targets [2] - Achieving just the initial benchmarks could result in Musk earning $26 billion, surpassing the total lifetime pay of several other tech CEOs combined [3] Shareholder Sentiment - The vote reflected a major show of confidence for Musk, with the board expressing relief that the proposal passed, as Musk had threatened to leave if it failed [4][6] - Despite criticism from various stakeholders, including major investors and proxy advisory firms, the board emphasized Musk's essential role in Tesla's future [5][7] Strategic Importance - The board argued that Musk's leadership is crucial for navigating Tesla's plans for future innovations, including humanoid robots and self-driving taxis [8][10] - The approval of the pay package comes after a previous $56 billion compensation plan was struck down by a judge, highlighting the contentious nature of Musk's compensation [9] Market Context - Tesla shares have increased nearly 20% since the beginning of the year, despite facing challenges such as an aging car lineup and competition from other electric vehicle manufacturers [11][12] - Musk acknowledged potential rough quarters ahead but expressed optimism about achieving "autonomy at scale" in the near future [12]

Core Viewpoint - The proposed compensation package for Elon Musk is valued at $1 trillion, structured over ten years and contingent on achieving specific operational and financial milestones [1][4]. Operational Milestones - Musk must deliver 20 million vehicles, build 1 million robots, and scale the robotaxi service to 1 million cars [2]. Financial Targets - The financial targets include adjusted EBIT and market cap goals, with compensation tied to the achievement of these milestones [3]. Voting Power and Investor Concerns - A significant point of contention among investors is Musk's voting power, which is linked to the compensation structure, leading to a divide between the board's support for Musk and institutional investors advocating for a no vote [5][6]. Key Man Risk - Major shareholders, including Norway's sovereign wealth fund and CalPERS, have expressed concerns over the reliance on Musk, highlighting the key man risk associated with his leadership [8][9]. Succession Planning - A new requirement in the compensation package mandates Musk to participate in a succession plan, which includes finding a successor by the end of the ten-year period [11][12]. Shareholder Proposals - A non-binding shareholder proposal is under consideration, focusing on the financial implications of Tesla's involvement with other Musk ventures, particularly regarding capital expenditures and potential cash burn [16][17].