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Investors in the electric car maker gathered this Thursday to decide on a substantial remuneration plan for CEO Elon Musk valued at around $1 trillion. Should it pass, this plan would showcase shareholder trust that the billionaire can guide the automaker into an period defined by machine learning and automation. Should it fail, Tesla could potentially face the loss of a key figure who historically built the corporation synonymous with electric vehicles.

Record-Breaking Milestones and Market Capitalization

Upon reaching the formidable objectives specified in the compensation plan presented at Tesla's shareholder gathering, he could become the pioneering person with a trillion-dollar net worth. To accomplish this, he must lead Tesla to a staggering $8.5 trillion in market value, which is eight times its current valuation. Additionally, he will be obligated to launch numerous self-driving cars and humanoid robots, while maintaining the corporate profits in the hundreds of billions of dollars over the next decade.

Payment Breakdown

The primary objectives of the remuneration structure, split into twelve stages, delineate a path for Tesla to reach its enormous market capitalization. If successful, Musk would be eligible to benefit from an additional 12% of the firm's equity. To qualify, he must remain vested with the corporation for at least 7.5 years. He will also help develop a future leadership strategy for the enterprise he has managed for in excess of 20 years. The stock options offered by the updated remuneration deal, alongside shares promised in his earlier deal, would grant Musk with a quarter stake of Tesla's stock. By the start of November, Tesla equity was priced approaching its yearly maximum, at roughly $450 per share.

Lofty Goals

During a ten years, Musk will be obligated to deliver 20 million EVs to consumers, market 10 million live FSD memberships, develop and sell 1 million humanoid robots, and introduce 1 million robotaxis in commercial service.

Musk will also be tasked to elevate the company to $400 billion in tangible revenue for a full year. Tesla's tangible revenue for the July-September 2025 were $4.2 billion, a 9% decrease from the previous year.

In November, Musk's fortune was valued at $460 billion, the leading in the world, according to financial data.

Reviving a Revoked Deal

Shareholders are furthermore reviewing a proposal that would compensate Musk after his previous pay package was invalidated by a judicial body in Delaware. The compensation package, estimated to be $56 billion, was challenged by a single stockholder who won his case. The Delaware judicial system denied Musk's pay package twice. Should investors pass the arrangement in the Thursday ballot, Musk is set to be awarded the huge sum regardless of if Tesla and Musk overturn the ruling of the legal matter.

Subsequent to Musk's previous compensation plan was first rescinded, he transferred Tesla's legal headquarters from Delaware to Texas. He repeated the action with his aerospace company and additional corporate bases. In 2024, according to Texas regulations, shareholders again passed the compensation plan.

But Delaware's so-called "court of equity" once again denied one of the most substantial CEO payouts in recent times. In the wake of that negative decision, Musk posted on his accounts to express dissatisfaction with the region and its "activist chief judge", arguably sparking a wave of business departures that Delaware legislators have attempted to staunch with new laws.

In reviewing whether Musk had improper sway in being granted that 2018 pay package, a noted legal scholar observed that the court recognized that other "high-profile executives" like the Meta chief and the Amazon founder were not granted this type of goal-oriented agreements.