Tesla's, TSLA, board has proposed a $1 trillion compensation plan for CEO Elon Musk

Tesla’s board has unveiled a proposed $1 trillion compensation plan for CEO Elon Musk, one of the largest in corporate history. If approved, the package could give Musk control of up to 12% of Tesla’s stock, expanding his influence over the company as it pivots deeper into artificial intelligence, robotics, and autonomous vehicle development.

The plan is structured entirely around performance milestones, with Musk’s compensation tied to achievements such as scaling production of robotaxis and humanoid robots, as well as hitting specific market capitalization goals. Like his 2018 pay plan, Musk would receive no salary or cash bonuses. If he meets the outlined targets, the award would substantially boost his voting power from its current level of around 13%. Critics, however, have raised concerns about governance, shareholder oversight, and potential stock dilution, warning that so much concentrated control in Musk’s hands could pose risks—particularly given his growing political activities, including his recent announcement to launch a third U.S. political party.

Supporters argue that the plan closely aligns Musk’s incentives with Tesla’s long-term vision, rewarding innovation and growth. Following the announcement, Tesla shares gained roughly 2.2% in premarket trading. The proposal will go before shareholders in November after review by a special committee of independent directors. Earlier this year, the board approved a $29 billion interim package to secure Musk’s leadership through at least 2030, reinforcing the company’s commitment to its AI and robotics strategy.

The record-setting compensation proposal comes as Tesla faces slowing EV demand and intensifying competition from Chinese automakers like BYD. Against this backdrop, the board appears to be doubling down on Musk as the key to maintaining Tesla’s market leadership while pushing into new technological frontiers.