Tesla investors approve Elon Musk's $1 trillion pay package - but the money won't come easy

By William Gavin

The CEO will have to meet a series of goals to earn the rewards, including raising Tesla's market capitalization to $8.5 trillion

Tesla CEO Elon Musk could earn up to $1 trillion of company stock after investors approved a new compensation package.

Tesla Inc. shareholders have thrown their support wholeheartedly behind Chief Executive Elon Musk, signing off on a compensation package worth up to $1 trillion on Thursday.

More than 75% of investors, according to preliminary results, voted in favor of a proposal to give Musk the package, which ensures that he will stay at the company for about a decade. Official results will be made public later.

"What we're about to embark upon is not merely a new chapter in the future of Tesla, but a whole new book," Musk said Thursday after taking the stage at Tesla's factory in Austin, Texas, and thanking investors.

If Tesla (TSLA) can meet a series of goals outlined in the proposal, Musk will be awarded 423 million shares and earn more than 25% voting control, which he has said he needs to feel comfortable moving forward with the company's artificial-intelligence and robotics plans.

"It's called compensation, but it's not like I'm going to go spend the money," Musk said on the company's October earnings call. "The point is that I just need enough voting control to give a strong influence, but not so much that I can't be fired if I go insane."

See More: Here's what Elon Musk must do to become a Tesla trillionaire

The plan requires Musk to raise Tesla's market capitalization to $8.5 trillion from its current $1.5 trillion and follow through on several product goals. That includes delivering at least 1 million Optimus humanoid robots to customers and launching ride-hailing services with at least 1 million robotaxis. Both efforts are seen as key to Tesla's future.

Proponents argued that if Musk meets those goals, he'll create enormous value for shareholders, and that there's less risk involved since he only gets paid for what he achieves. Critics have raised concerns over the dilution of shares, increased "key man" risk and the size of the package.

Musk on Thursday gave a series of updates on Tesla's plans, including announcing that its electric semi-truck will enter mass production next year. He also said that Tesla will begin making a dedicated robotaxi vehicle next April.

Tesla's existing ride-hail service will expand beyond Austin and San Francisco to launch in Nevada, Florida and Arizona, the company said. Although the company calls it a robotaxi network, Tesla currently uses Model Y SUVs equipped with driverless software and overseen by a safety driver.

Musk also said Tesla expects to receive approval to offer its Full Self-Driving software in Europe and potentially China in the first quarter of 2026. Expansion in either market could open up additional streams of revenue for Tesla, which offers its software for either a flat fee or a monthly subscription.

Another proposal approved Thursday gives Tesla's board the ability to grant Musk the shares he earned under a 2018 compensation package that is being litigated in Delaware. It will also replenish a pot of 60 million shares the company uses to incentivize employees.

Also on the ballot was the re-election of three members of Tesla's board of directors: Airbnb Inc. (ABNB) co-founder Joe Gebbia; the venture capitalist Ira Ehrenpreis; and former Walgreens Boots Alliance Inc. executive Kathleen Wilson-Thompson. Both Ehrenpreis and Wilson-Thompson are on Tesla's compensation committee. All three were re-elected to their posts.

All shareholder proposals were rejected except for one. Investors supported a nonbinding proposal that asked Tesla's board to explore investing in xAI - the artificial-intelligence startup that Musk founded in 2023 to compete against OpenAI, which he once backed but has since soured on. The startup's Grok chatbot has been integrated with Tesla's vehicles and robots.

The proposal leaves it up to Tesla's board to determine the size of a potential investment, which would help xAI cover the high costs of building out its AI models. Last month, Bloomberg reported that the startup was seeking to raise about $20 billion from backers like Nvidia Corp. (NVDA) as it burns through about $1 billion per month.

It's not unusual for Musk's legion of companies to work together. Most recently, SpaceX replaced its existing fleet of vehicles with Tesla's Cybertruck pickup trucks. Musk's tunneling venture, the Boring Co., was initially founded as a subsidiary of SpaceX and has frequently worked with Tesla.

-William Gavin

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11-06-25 1846ET