Tesla shareholders voted in favour of a US$1 trillion (A$1.534 trillion) compensation plan for Elon Musk, which could give the world’s richest man the largest corporate payout in history and potentially make him the first ever trillionaire.
While the pay package was initially opposed by several high-profile investors, 75% of investors voted in favour of the plan, in a testament to shareholders' confidence in Musk. The vote did not include the 15% of the company Musk already owns.
The crowd at the meeting celebrated the results with cheers and chants when they were announced.
“I super appreciate it,” Musk said.
While Musk doesn't take any salary, the approved package would give him as many as 423.7 million additional Tesla shares over the next 10 years.
For Musk to qualify for the full potential payout, which would amount to around US$1 trillion, the company would need to reach a US$8.5 trillion market cap and a series of other operational or financial targets.
Reaching the US$8.5 trillion market cap is a lofty goal that would require the company’s shares to jump 466% from today’s stock price.
The goal is also 70% higher than the world’s most valuable company, Nvidia, which hit a record US$5 trillion market cap last week.
Musk is already worth US$473 billion, according to Bloomberg’s billionaire tracker. This mostly comes from his holdings in Tesla and his other ventures like SpaceX and xAI.
If shareholders voted to reject the pay package, Musk would have exited the company. In a filing, Tesla’s board said Musk had raised the possibility of leaving the company if he didn’t get the assurances of control that the pay package could grant him.
Critics have argued that awarding Musk this win ignored the challenges the company faced.
“Elon Musk just got $1 trillion for failure. 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,” the protest group Tesla Takedown said in a statement.
Tesla has had a tumultuous year, where stocks slumped to a low of US$222 in April due to Musk’s heavy involvement in right-wing politics and with U.S. President Donald Trump.
Since then, Tesla stock has begun to stabilise and rise.
At the time of writing, Tesla (NASDAQ: TSLA) shares are down 3.54% to US$445.91. The company’s market cap is US$1.40 trillion.
