Automotive industry Tesla shareholders decide on huge share package for Musk
Tesla is facing a fateful shareholder vote. The shareholders of the electric car manufacturer will decide at the Annual General Meeting on Thursday (from 22:00 CET) whether company boss Elon Musk will get the prospect of a huge new block of shares.
06.11.2025, 02:46
SDA
Acceptance of the plan is not guaranteed: Two influential advisory firms that make recommendations for shareholders, among others, spoke out against it. Musk has threatened to resign as Tesla CEO if the compensation plan is not approved.
The package could be worth around one trillion US dollars - at least if the car manufacturer were to be worth 8.5 trillion dollars on the stock market in ten years' time. That would be almost six times as much as it is now. With such an increase in value, the value of the shares he already owns would also break the trillion mark.
Other prerequisites for receiving the shares include Musk remaining in the boardroom for a decade - and Tesla having one million Robotaxis in use and delivering one million AI robots.
Target of 20 million Teslas sold
In total, Musk could receive up to 423.74 million Tesla shares - in twelve stages, most of which are linked to steps of 500 billion dollars in market capitalization. Added to this are the business targets, such as the delivery of 20 million Teslas with a market capitalization of two trillion dollars. An even bigger hurdle could be to break through the $400 billion mark in adjusted earnings before interest, taxes, depreciation and amortization in addition to the $6.5 trillion market capitalization.
Robyn Denholm, Chairwoman of the Board of Directors, emphasizes that Musk will come away empty-handed if Tesla does not meet its targets. Musk himself says that he is more interested in increasing his Tesla stake to 25 percent and thus securing his influence in the company than the money.
Focus on robots and robotaxis
Tesla, the electric car pioneer that led the industry on an expensive race to catch up a few years ago, looks disenchanted and is heading for its second year of declining sales. However, Musk argues that Tesla's future lies in self-driving robotaxis and humanoid robots anyway.
The tech billionaire also believes that the company's "Optimus" robots have the potential to become the "greatest product of all time". Version 3, which is planned for next year, will move so smoothly that it will look "like a human in a robot suit", Musk said recently. Self-driving cars and robots would bring about a "world without poverty" in which everyone would have access to the best medical care. Because: "Optimus will be an incredible surgeon," Musk announced. He hopes to start production of the robots by the end of next year.
Control over the robot army
Musk links his demand for a 25 percent stake directly to control over the new technology. "If we build this army of robots - will I at least have a strong influence on this army of robots?" he said a few days ago. Otherwise, he is not comfortable with the idea.
If Musk's priority is influence in the company and not money, couldn't Tesla have simply given him some shares with additional voting rights? After all, at tech heavyweights such as Google and the Facebook group Meta, a system with different types of shares has ensured control by the founders for years. Denholm said on the business channel CNBC that this is only possible before an IPO.
Norwegians vote against
Among those voting against the package is the Norwegian Oil Fund, the largest sovereign wealth fund in the world. Two days before the meeting, the fund announced that it appreciated the considerable added value that Musk had created with his visionary role. At the same time, however, the Norwegians raised concerns about the unprecedented level of the proposed remuneration, among other things.
This is not the first controversy surrounding Musk's remuneration. Tesla met all the targets set at the time for a share package promised to him in 2018. However, a court in the state of Delaware, where Tesla was formally based at the time, ruled that Musk had too much influence on the Board of Directors when the plan was agreed and that the shareholders had not been sufficiently informed about this. The appeal process is still ongoing.
