“Stay, Elon!” Tesla’s Shocking $1Trillion, Decade-Long Pay Package Revealed

TradingKey - To retain Tesla CEO Elon Musk and keep him leading the top electric vehicle manufacturer while driving greater value in artificial intelligence and robotics, Tesla’s board is offering a compensation package worth up to $1 trillion over ten years — the largest executive pay package in U.S. corporate history.

On Friday, September 5, Tesla’s board released a filing revealing a plan to award Musk $87.8 billion in stock over a decade. If he meets all performance targets and earns all restricted stock units, the total value of this compensation could reach approximately $1 trillion.

The document states that Musk must participate in the board’s development of a long-term CEO succession framework to be eligible for the final two performance-based awards.

Chair Robyn Denholm wrote:

“Retaining and incentivising Elon is fundamental to Tesla . . . becoming the most valuable company in history. The package is designed to align extraordinary long-term shareholder value with incentives that will drive peak performance from our visionary leader.”

The board has set ambitious targets for Musk, including:

• Scaling the Robotaxi (autonomous taxi) business
• Growing Tesla’s market capitalization from its current level of around $1 trillion to over $8.5 trillion — more than double the current market cap of Nvidia, the most valuable U.S. company

In essence, the board is offering Musk an entire Tesla over ten years to keep him fully focused on the company’s high-growth trajectory. The board emphasized that if Tesla’s growth stalls, Musk will earn nothing.

More specifically, the new plan requires Musk to achieve 12 performance milestones, including:

• Delivering 1 million Optimus robots
• Selling 20 million Tesla vehicles
• Having 1 million Robotaxis in commercial operation
• Growing EBITDA to $400 billion

This latest proposal comes after a Delaware court recently rejected Musk’s 2018 compensation package, valued at over $50 billion. While Tesla continues to appeal that ruling, the company is pursuing alternative ways to compensate Musk — including a $30 billion stock award granted in early August.

Under the new arrangement, Musk would gain over 25% ownership of Tesla. He had previously threatened to leave the company if the board did not grant him greater voting control.

Regarding public criticism of Musk’s personal views and political activities, the Tesla board has chosen to stand firmly behind him.

The filing states:

“Musk’s high public profile attracts significant scrutiny, and that some have questioned whether his personal views or outside activities might be a distraction from his leadership of Tesla. While media coverage often emphasizes these concerns, our direct experience with Musk does not support that characterization.”

In pre-market trading on Friday, Tesla’s stock rose from an initial 1% gain to 2%. However, Tesla shares are still down 16% year-to-date, underperforming the S&P 500’s 10.5% gain over the same period.