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Tesla shareholders are scheduled to meet in Austin on Thursday to decide on a record performance-based pay package for CEO Elon Musk. The award could reach about $1 trillion if Tesla hits demanding goals for vehicle output, robotaxis, humanoid robots, and market value. The vote will determine how tightly Musk’s fortunes remain tied to Tesla’s future.
The plan grants Musk 12 stock-option tranches that vest when Tesla meets set operational and valuation milestones, including a path to an $8.5 trillion market capitalization. If approved, his ownership would increase to 25%.
Supporters say the package aligns Musk’s rewards with long-term growth in Tesla stock and profits. They argue that investors benefit if Tesla’s market value rises enough to unlock the awards.
Opponents, including Norway’s sovereign wealth fund and proxy advisers Glass Lewis and ISS, argue that the deal is excessive and dilutes the interests of existing investors. They also highlight governance concerns, noting court rulings that questioned how Tesla’s board handled Musk’s 2018 compensation plan.
Shareholders also vote on the re-election of several Tesla directors who helped structure the new pay deal. Directors Ira Ehrenpreis, Kathleen Wilson-Thompson, and Joe Gebbia seek fresh terms as investors assess their oversight of risk, compensation, and company strategy.
Earlier this year, several Tesla directors returned hundreds of millions of dollars to settle claims that their prior pay was excessive. That settlement sharpened debate over board independence.
Some investors say a simple majority rule could strengthen accountability, while others worry it might further increase Musk’s influence as his ownership stake grows. The meeting also comes as Tesla stock trades near record highs but remains volatile.
Shareholders will also decide whether Tesla should invest in Musk’s AI startup, xAI. Musk links xAI to Tesla’s future in autonomous driving and robotics, and Tesla already uses the startup’s Grok chatbot in its vehicles.
The board has not endorsed the xAI investment and has left the choice to shareholders, who must weigh the potential benefits of AI against concerns about conflicts of interest across Elon Musk’s companies. Another resolution urges Tesla to adopt a policy of political neutrality, which would limit partisan activity by the company and its leaders.
Supporters say such a policy could reduce reputational risk linked to Musk’s public statements, while critics argue that existing disclosure and ethics rules already address these issues. The votes on pay, board seats, xAI, and neutrality will reveal how much control investors are willing to grant Musk as Tesla advances in electric vehicles, AI, and robotics over the next decade.
Also Read: Elon Musk’s $1 Trillion Tesla Compensation Plan Sets Bold New Targets
