Elon Musk’s future at Tesla could be in the balance on Thursday when shareholders vote on whether to approve his record-shattering $1 trillion pay package.
The controversial proposal, which is scheduled to be considered at Tesla’s annual meeting in Texas, would hand Musk an unprecedented payout tied to a series of performance benchmarks.
Critics – including key proxy advisory firms ISS and Glass Lewis and even Pope Leo XIV – argue the proposed salary is excessive. Meanwhile, Tesla chairwoman Robyn Denholm and Musk himself have warned that he could leave the company entirely if shareholders reject the proposal.
“Tesla may lose his time, talent and vision, which have been essential to delivering extraordinary shareholder returns,” Denholm said in a recent letter posted on X.
Musk has framed the vote in near-apocalyptic terms – declaring in an Oct. 29 X post that “control of Tesla could affect the future of civilization.”
The billionaire has argued that he needs greater voting control offered by the stock grants in order to effectively guide Tesla’s future plans for artificial intelligence, which include the robots and full self-driving technology. Musk would control nearly 29% of voting shares if he hits all targets.
The jaw-dropping pay package, unveiled in a September proxy filing, was crafted by Tesla’s board after a Delaware judge struck down a previous $56 billion compensation plan for Musk. The judge ruled that the previous package, which was approved in 2018, was excessive and riddled with conflicts of interest.
Under the latest proposal, one tranche of Musk’s pay would be awarded if Tesla hits a $2 trillion valuation and delivers 20 million vehicles. Another would kick in if Tesla is valued at $3 trillion and delivers 1 million of its “Optimus” humanoid robots.
The new pay package drew a major rebuke this week from Norway’s sovereign wealth fund, which became the largest Tesla stakeholder to say it opposed the plan.
“While we appreciate the significant value created under Mr. Musk’s visionary role, we are concerned about the total size of the award, dilution, and lack of mitigation of key person risk,” stated Norges Bank Investment Management, which oversees the sovereign wealth fund.
Tesla shares were down nearly 5% in Tuesday’s trading.
Pope Leo XIV previously cited Musk’s pay package as an example of the loss of “the value of human life, of the family, of the value of society.”
“Yesterday, the news [arrived] that Elon Musk is going to be the first trillionaire in the world,” Leo told Catholic news outlet Crux in an interview published in September.
“What does that mean, and what’s that about?” the pontiff continued. “If that is the only thing that has any value any more, then we are in big trouble.”
ISS and Glass Lewis have also recommended that shareholders say no, asserting that the pay is excessive and could dilute the holdings of other investors.
Tesla’s largest individual investors, including BlackRock, State Street and Vanguard, have yet to reveal how they plan to vote.
Despite the lingering uncertainty, Wedbush analyst Dan Ives said he expects shareholders to give a “bright green light” to the plan.
“With the AI Revolution this is a crucial time for Tesla ahead with autonomous and robotics front and center,” Ives said in a note to clients on Monday.
“We expect shareholders to show overwhelming support for Musk and the xAI stake further turning Tesla into an AI juggernaut with the autonomous and robotics future on the horizon.”
With Post wires
