Thursday, Tesla shareholders have approved an unprecedented $1 trillion pay package for CEO Elon Musk. The full compensation plan will be in place by 2035 — assuming Musk and the company successfully meet ambitious financial and production targets. If that happens, Musk will also gain control of about 25 percent of the business, up from the 12 percent he currently controls. More than 75 percent of Tesla shareholders approved the move in an early vote.
Kasturi celebrated the news on stage at Tesla’s Gigafactory in Austin, Texas, accompanied by two dancing humanoid robots from the company’s Optimus product. “Look at us, it’s sick,” he said.
To meet its goals, however, Tesla needs to lead in industries beyond electric cars—and guarantee that Optimus can do more than dance. It has to beat all competitors in autonomous driving technology and robotics. “Tesla needs to be the market leader not just in the US, but in Europe and other regions,” said Seth Goldstein, a senior equity analyst at Morningstar, a financial services firm.
Specifically, Tesla needs to raise $8.5 trillion over the next 10 years, deliver 20 million vehicles to customers, ship 1 million robots, operate 1 million robotaxis and sell 10 million subscriptions to its “fully self-driving” software over a three-month period—among other financial goals.
Still, the vote marks a win for Musk, whose previous package, set for a $50 billion payday in 2018, has been embroiled in a lawsuit after a shareholder complained that the CEO had too much influence on the company’s board and was therefore failing to uphold his legal obligations to Tesla shareholders. The case, brought in Delaware’s Chancery Court, led to Tesla’s re-incorporation in Texas. A panel of judges heard the case on appeal in October; They are likely to make a final decision next month.
Tesla Shareholders Approve Elon Musk’s
Before the vote, Tesla’s board argued that the sky-high pay package was necessary to keep Musk as CEO—and keep him focused on the car company. In a call with investors last month, Musk suggested he would have a hard time pushing Tesla into robotics and autonomy if he didn’t have strong influence over the automaker. If we build this robot army, will I at least have a strong influence on this robot army?” she asked. “I don’t feel comfortable building that robot army unless I have a strong influence.”
After Thursday’s vote, Musk told investors gathered in Texas that production of the CyberCab, a self-driving car with no steering wheel or sideview mirrors, would begin in April. The company will need permission from the federal government to put the unconventionally designed car on the road.