Tesla Shareholders Back Elon Musk’s $1 Trillion Pay Plan

Tesla shareholders approved a performance-based pay plan worth up to $1 trillion for CEO Elon Musk, affirming their bet on his push to transform the carmaker into a broader AI and robotics company.

What Happened

The vote, held at Tesla’s annual meeting in Austin on November 6, 2025, passed with more than 75% support, according to preliminary results. The award would be granted entirely in stock over roughly a decade and vests only if Tesla hits a series of market-value, profitability and product milestones. The structure mirrors Musk’s past performance-based packages but is far larger in potential value and scope. More than 75% voted in favor, despite opposition from some large institutions and proxy advisers.

Ambitious Targets

The plan is split into 12 tranches that vest as paired targets are met over time. Those include sustained profitability hurdles and product milestones related to autonomous vehicles and humanoid robots, alongside substantial market-cap thresholds culminating in an $8.5 trillion valuation target. If all goals are achieved, Musk’s stake could rise toward one quarter of the company, further aligning his fortunes with Tesla’s long-term performance. Vesting is spread across 12 tranches over a decade, underscoring how dependent the payout is on execution.

How We Got Here

The new package follows years of wrangling over Musk’s compensation. A Delaware court in January 2024 voided his prior 2018 award—once valued around $56 billion—finding flaws in the process. Shareholders later re-ratified that earlier plan in June 2024, and Tesla moved to reincorporate in Texas, but the judge reaffirmed the invalidation months afterward. The fresh, far larger plan seeks to reset incentives and retain Musk amid Tesla’s shift beyond EVs into software, robotaxis and factory automation.

Debate And Next Steps

Backers argue the package ties Musk’s reward squarely to shareholder value creation and helps ensure he remains focused on Tesla as it pursues autonomous driving and robotics. Critics—including leading proxy firms and Norway’s sovereign wealth fund—warn it concentrates too much power in one individual and risks significant dilution if targets are met. Beyond the compensation vote, shareholders also backed governance changes and signaled openness to closer ties with Musk’s AI ventures, according to meeting disclosures. The real test now is operational: hitting the milestones that would unlock the tranches and, ultimately, justify the historic bet shareholders just made.

Sources

• Tesla Shareholders Approve Elon Musk’s $1 Trillion Pay Package — Wall Street Journal (November 6, 2025)
• Elon Musk's $1 trillion Tesla pay plan wins shareholder approval — Reuters (November 6, 2025)
• Tesla Shareholders Approve $1 Trillion Pay Package for Musk — Bloomberg Law (November 6, 2025)
• Tesla offers Elon Musk pay package worth $1 trillion, with conditions — The Washington Post (September 5, 2025)
• Delaware judge reaffirms ruling that invalidated massive Tesla pay package for Elon Musk — Associated Press (December 2024)