The Tesla Board of Directors has presented a new compensation plan for CEO Elon Musk, which could bring him $1 trillion over the next decade if he can achieve a series of goals. This is reported by UNN with reference to Financial Times.
Details
Under the plan, presented on Friday, "Musk will not receive a salary or bonuses, but will collect shares in tranches that will be unlocked as Tesla's market value grows." This will also be aided by achieving key milestones such as a significant increase in profits and the sale of millions of cars, robotaxis, and AI-powered robots.
Retaining and incentivizing Elon is fundamental to Tesla... becoming the most valuable company in history
The package "is designed to combine extraordinary long-term value for shareholders with incentives that will promote peak performance from our visionary leader"
The Board of Directors emphasized that Musk's incentives are aligned with investors' interests, and he will receive nothing if Tesla's growth stalls. However, the sheer scale of the deal is likely to reignite fierce debates about the billionaire's earnings
Terms
To receive the new compensation package - 423 million shares - Musk will have to raise Tesla's market capitalization to $8.5 trillion, compared to the current $1.09 trillion. This is more than double the value of Nvidia, which is currently the most expensive company in the world ($4.2 trillion).
In addition, Tesla must:
- sell another 12 million electric vehicles;
- attract 10 million autonomous driving subscriptions;
- launch a network of 1 million Robotaxis;
- sell 1 million AI robots;
- increase profit 24-fold - to $400 billion
dollars.
It should be noted that last year Tesla's adjusted profit was only $16.6 billion, the company sold 8 million cars and has not yet sold any robotaxis or AI robots.
Addition
In 2018, Tesla had already approved a large-scale deal regarding Elon Musk's stake, but it was later canceled by a Delaware state court after a lengthy legal dispute. Despite this, Musk remains one of the richest people in the world with a fortune of $374 billion - thanks to Tesla shares and his own companies SpaceX, xAI, Neuralink, and The Boring Company.
Musk himself has repeatedly hinted that he might reduce his stake in Tesla or even leave the company if he is not given more voting rights.
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