Elon Musk’s $1tn pay deal approved by Tesla shareholders
Tesla shareholders have approved a record pay packet for boss Elon Musk that could be worth around $1 trillion (£760bn).
The unprecedented deal was approved by 75% of Tesla shareholders who voted at the firm’s annual general meeting on Thursday.
The deal requires Musk, already the richest man in the world, to greatly increase the market value of his electric car company within a few years. If he meets various targets, he will be rewarded with hundreds of millions of new shares.
The scale of the deal is controversial, but Tesla’s board has argued that Musk could leave the company if it is not approved and cannot afford to lose him.
The announcement received loud applause from the audience at the meeting in Austin, Texas. Musk took the stage and danced to chants of his name.
“What we are about to begin is not just a new chapter in the future of Tesla, it is a whole new book,” he said.
“Other shareholder meetings are meant to be postponed, but ours are crazy. Look at this. It’s disgusting,” Musk said.
Milestones reached by Musk include increasing Tesla’s market value from $1.4 trillion to $8.5 trillion at the time of this writing.
Additionally, one million driverless “Robotaxi” vehicles will need to be put into commercial operation.
But his initial comments Thursday focused attention on the Optimus robot and dashed the hopes of some longtime analysts and Tesla watchers who wanted Musk to focus on revitalizing the company’s electric vehicle business.
“Let Musk’s head sink where it is,” analyst Gene Munster, managing partner of Deepwater Asset Management, wrote of X.
“His ‘new book’ vision begins with Optimus. Cars, FDS and robotaxis are not mentioned yet.”
In later statements, Musk referenced FSD, short for fully autonomous driving, saying the company was “almost comfortable” allowing drivers to “basically text and drive.”
He also likened dealing with regulators to being in a Franz Kafka novel.
US regulators are investigating Tesla’s self-driving feature after several incidents in which cars ran red lights or drove on the wrong side of the road.
Some of these incidents resulted in accidents causing injuries.
Tesla shares were slightly higher in after-hours trading but are up more than 62% in the past six months.
Analyst Dan Ives, a longtime fan of the company, called Musk “Tesla’s greatest asset” in a note published after the vote.
“We continue to believe that AI valuation has been unlocked and believe the march towards an AI-driven valuation for TSLA has begun over the next 6-9 months,” Mr. Ives added.
