Tesla Shareholders Approve Elon Musk’s Record $1 Trillion Pay Deal

New Delhi: At Tesla's annual shareholder meeting on Thursday in Austin, Texas, a decision was taken that could prove to be a milestone in corporate history. Company CEO Elon Musk got a salary package of up to 1 trillion dollars (about Rs 84 lakh crore) for 10 years. The package is completely based on performance – no cash salary, just stock options. If Tesla achieves the target set in the next decade, Musk could become the world's first trillionaire.

What percentage of shareholders passed the proposal?

In the meeting, more than 75% of shareholders gave the green signal to the proposal. Describing the results, the company's General Counsel Brandon Ehrhart said that this decision shows confidence in Musk's vision. Musk danced on stage with two Optimus robots and said, "This is awesome." Tesla stock rose 3% in after-hours.

How will the package work?

This package is divided into 12 phases (tranches). Musk will not receive any base salary, but if the company meets targets, he will receive more than 423 million shares. With this, his stake in the company will increase from 13% to 25%. Main goals:

The company's market cap increased from $1.5 trillion to $8.5 trillion (about a 6-fold increase).

• Selling 20 million vehicles.
• Driving 1 million robotaxis.
• Selling 1 million humanoid robots (Optimus).
• 10 million full self-driving subscriptions.
• $400 billion profit in four quarters.

The first tranche will open at a $2 trillion cap, with the next at every $500 billion or 1 trillion increments. "This package is a roadmap for transforming Tesla into AI and robotics," Musk said. Even if just a few goals are met, they could still get billions of dollars.

Why was it approved, despite controversies?

Tesla Chair Robin Denholz warned shareholders that if the package is rejected, Musk could leave the company. "Without Musk, Tesla's value would be diminished," the board said. Musk also said on an earnings call in October, "I want more control to build a robot army." Small retail investors and big names in Silicon Valley supported it on X, arguing that Musk gets nothing without results, but there was also opposition. 

What was the stance of the Sovereign Wealth Fund?

Norway's $1.9 trillion sovereign wealth fund (with a 1.2% stake in Tesla) abstained from the vote. "This package is too big, will increase dilution of shares and there is a risk of dependence on Musk," he said. Proxy advisory firms Glass Lewis and Institutional Shareholder Services also objected. Groups like Public Citizen said, "This is 1.6 million times more than the US median salary." Still, the majority of users expressed confidence in Musk's vision.

What is the background of the last package?

This decision is related to the $56 billion package of 2018, which was canceled by the Delaware Court. Shareholders alleged that the board was under Musk's influence. Tesla appealed, but by then brought a new package. An interim package of Rs 29 billion was approved in August, and this mega plan in September. The Delaware Supreme Court will now decide on the old one.

What impact on the economy?

This package is bigger than the GDP of many countries. From IMF data – Netherlands (1.27 trillion), Poland (0.98 trillion), Switzerland (0.95 trillion). One user on X said, "Musk can buy entire countries." Critics are calling it capitalism in favor of the rich, but supporters say – it will promote innovation. Tesla is now focusing on AI, robotics ahead of EV. Musk announced a production line of 1 million Optimus units at the Fremont factory.