Tesla shareholders say “yes” to Musk’s $1tn paycheck
Elon Musk could be on the verge of becoming the world’s first trillionaire as Tesla shareholders approve a pay package that could be worth nearly $ 1 trillion. But there is a caveat: Musk must meet extremely demanding performance targets to ever see it.
In a big day for the world of the wealthy, the unprecedented deal received the approval of more than 75% of shareholders during the company’s annual general meeting on Thursday.
Following the announcement, Musk reportedly got on a stage to celebrate the moment.
“I super appreciate it. Thank you, everyone,” he said, according to NBC. “What we’re about to embark upon is not merely a new chapter on the future of Tesla but a whole new book.”
"Other shareholder meetings are snoozefests but ours are bangers. Look at this. This is sick,” he added.
Musk is already the world's richest man, with a net worth of about $481.4 billion, so the payout deal has drawn criticism. However, the board reportedly claimed that the Tesla owner might leave if the payout was not approved, adding that securing his commitment to Tesla was "critical" to avoid significant value loss.
He became the first person to be worth $500 billion, with Tesla’s stock surge putting him ahead of Larry Ellison, the co-founder of Oracle Corporation. Tesla’s brand took a revenue hit earlier this year amid Musk’s involvement in the Trump administration, but it has since rebounded, jumping 14% on the year, according to Forbes.
The compensation package, also known as the largest corporate pay package in history, was first proposed in September. It followed Musk’s continuous statements that he wishes to have more of a stake in the company, as well as a legal battle over his 2018 pay package - then valued at a mere $56 billion.
Musk doesn’t take any salary, but the deal means that he will get as much as 423.7 million additional Tesla shares over the next 10 years. Several conditions are included, such as the requirement for Musk to create nearly $7.5 trillion in value for shareholders for him to receive the full award. He will also have to remain with the company for at least seven and a half years and up to 10 years to vest in the full award.
If you’re wondering how much exactly $1tn is (don’t worry, we’ve been thinking the same), here are some stats to put it into perspective: it would take an average US worker around 17.24 million years to earn that much. The amount is also close to Switzerland's GDP, which was $936.56 billion in 2024.
Despite the hit Tesla has taken from Musk’s association with Trump and the government’s reduced support for electric vehicles, the billionaire is turning to robotaxis and humanoid robots to drive the growth. In Musk’s view, robots will be Tesla’s “biggest product of all time by far”, potentially ending poverty and changing the global economic order. These will be priced at $20,000 each.
However, with the prospect of world-changing robots still some time away, it’s not guaranteed that Musk will ever see the promised pay. The full list of the objectives he must meet is quite extensive, including bringing Tesla's overall market value to $8.5tn (currently $1.4tn), making up to $400bn in core profit, and delivering 20 million Tesla vehicles and one million robots over the next ten years.
