Tesla CEO dances on stage alongside the company’s robots after shareholders approve record-breaking deal
Elon Musk has won approval from Tesla shareholders for the largest corporate pay package in history, worth a potential $1trn (£761bn) if he hits a series of ambitious goals over the next decade.
The proposal, which would see the firm become an AI and robotics juggernaut, was approved by more than 75% of shareholders.
The result of the vote was announced at the company’s annual meeting at its factory in Austin, Texas, where Musk bounded to the stage accompanied by dancing robots.
“What we are about to embark upon is not merely a new chapter of the future of Tesla, but a whole new book,” Musk told a cheering group of shareholders.
“Other shareholder meetings are like snoozefests, but ours are bangers,” Musk said. “I mean, look at this. This is sick.”
Humanoid robots and robotaxis
The goals include the company delivering 20 million vehicles, having 1 million robotaxis in operation, selling 1 million robots and earning as much as $400bn in core profit.
Among its developments is a humanoid robot called Optimus, which Musk danced alongside at the meeting, and the Tesla website says aims to “create a general purpose, bi-pedal, autonomous humanoid robot capable of performing unsafe, repetitive or boring tasks.”
In order for him to get paid, Tesla’s stock value has to rise in tandem, first to $2trn from the current $1.5trn, up to $8.5trn.
Achieving each step – an operational goal and a valuation milestone – awards Musk 1% of stock.
That means the plan could still hand Musk tens of billions of dollars even if he falls short of most of its ambitious targets.
If Musk hits all of them, he would be eligible for 12% in stock, or about $1trn.
The true value of those shares would be $878bn, because the package is structured to give Musk up to $1trn in shares “minus the value of the stock on the day” the board passed the proposal in early September.
The value of the package is always a moving target because it would fluctuate based on changes in the stock price.
However, some major investors, including Norway’s sovereign wealth fund and other proxy advisors have opposed the package, calling it excessive.
Tesla’s board had said Musk could quit if the pay package was not approved.
Investment in AI
Shareholders voted in favour of Tesla investing in Musk’s artificial intelligence startup, xAI, though there were many abstentions.
Although conflict-of-interest concerns have arisen over Tesla’s possible investment in xAI, the move is seen as widely benefiting both companies.
The vote reduces investor concern that Musk’s focus has been diluted with his work in politics as well as in running his other companies, including rocket manufacturer SpaceX and xAI.
“Will the growth offset these concerns of dilution, or is this just giving Elon his wish of enough influence to shape the future of AI? That remains to be seen,” said Brian Mulberry, a senior client portfolio manager at Zacks Investment Management.
Musk has said he is interested in the higher voting stake he would get in Tesla as part of the pay package, more than the money, as he gears up to sell a “robot army.”
With agencies
