Tesla shareholders have overwhelmingly approved a historic $1 trillion pay package for CEO Elon Musk, reaffirming their confidence in his leadership as the company advances its artificial intelligence and robotics ambitions.
The compensation plan, which received more than 75 percent support at Tesla’s annual meeting on Thursday, was designed to ensure Musk’s continued service to the electric car maker over the next seven and a half years.
“I’d like to just give a heartfelt thanks to everyone who supported the shareholder votes,” an elated Musk told attendees at the company’s Austin factory, where the meeting was held. “I super-appreciate it,” he added, drawing cheers of “Elon” from the crowd.
The plan could raise Musk’s ownership stake in Tesla from about 12 percent to more than 25 percent, reinforcing his influence over the company’s strategic direction.
Tesla Chair Robin Denholm defended the payout, warning that Musk’s departure could trigger a sharp decline in Tesla’s stock value. “Keeping Elon is critical to Tesla’s future,” she said ahead of the vote.
The vote underscores the deep loyalty of Tesla’s investor base, despite controversies surrounding Musk’s political affiliations and his support for right-wing figures, including President Donald Trump.
Critics, however, blasted the approval as excessive, citing Tesla’s slump in vehicle sales and heightened safety concerns.
“Elon Musk just got one trillion dollars for failure,” activist group Tesla Takedown said in a statement after the vote. “Sales are down, safety risks are up, and his politics are driving customers away. This isn’t leadership it’s the world’s most expensive participation trophy.”
Supporters see things differently. Dan Ives, an analyst at Wedbush Securities, described the shareholder endorsement as a “watershed moment,” saying it cements Musk’s role at the forefront of the AI revolution.
Musk, already the world’s richest person with a net worth exceeding $500 billion, must meet 12 performance milestones to unlock the full payout.
The first tranche will vest when Tesla’s market capitalization hits $2 trillion, up from its current $1.5 trillion. Other milestones involve achieving operating profit targets and the delivery of 20 million vehicles.
The plan replaces a previous $55.8 billion compensation deal approved in 2018 but blocked by a Delaware court following shareholder litigation. Tesla’s board later adopted an interim $29 billion award before finalizing the new plan.
Despite the overwhelming approval, some proxy advisory firms remain skeptical. Institutional Shareholder Services (ISS) criticized the payout’s scale, calling it “unprecedented” and warning it could dilute accountability.
ISS also cautioned that Musk’s multiple ventures including SpaceX, Neuralink, and X (formerly Twitter) could distract him from Tesla’s operations.
