Tesla’s board of directors has recently proposed a new CEO compensation plan with a potential total stock grant value of up to $1 trillion. The plan will be submitted for shareholder approval at the upcoming general meeting.
Elon Musk has not received any new major compensation since 2017. His previous pay package generated tens of billions in returns but was struck down earlier this year by the Delaware Court of Chancery, which deemed it “excessive.” Against this backdrop, the board has put forward a new long-term incentive plan designed to ensure Musk continues to lead the company.
According to board members Robyn Denholm and Kathleen Wilson-Thompson, the new “2025 CEO Performance Award” follows the framework of the 2018 plan, tying rewards to measurable achievements. The vesting period is set at a minimum of 7.5 years, extendable up to 10 years, with the goal of maintaining leadership stability and reducing stock price volatility.
The new plan sets more ambitious targets for Musk, including:
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Achieving an adjusted EBITDA target 28 times higher than the peak of the 2018 plan.
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Deploying 1 million Robotaxis into operation.
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Delivering 1 million AI robots.
If Musk meets all these targets, it would require generating approximately $7.5 trillion in shareholder value.
The board emphasized that the proposal does not diminish the contributions of other employees but reflects the principle that “a ship needs a captain,” underscoring Musk’s central role in leading Tesla into its next stage of growth. They described the plan as both recognition of his past contributions and an incentive for future achievements.
The board urged shareholders to support the proposal at the upcoming meeting, stating that it would create the conditions for long-term growth and shareholder returns. They stressed that Tesla’s future is closely tied to Musk’s leadership and that keeping him at the helm is vital to realizing the company’s vision.