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Tesla shareholders are hours away from deciding the fate of Elon Musk’s $1 trillion pay package.
Tesla’s annual shareholder meeting kicks off Thursday afternoon at 4 p.m. ET at the company’s headquarters in Austin. A limited number of shareholders were invited to attend in person.
Tesla investors are voting on multiple proposals. Chief among them is Musk’s pay package, but shareholders will also consider proposals including whether Tesla should explore an investment in his AI startup, xAI. Investors will also decide whether to carve out Tesla share reserves for rewarding and attracting top talent (as well as allocating 208 million shares to “address the uncertainty” over Musk’s 2018 pay package, which remains snarled in a legal battle after a judge tossed it out).
The new compensation plan is contingent on Musk achieving multiple lofty goals. To earn the full $1 trillion value, Musk must boost Tesla’s market cap to $8.5 trillion by 2035, sell 12 million vehicles a year, and deploy one million robotaxis and one million humanoid robots.
The pay package has proven controversial.
Weeks ahead of the vote, proxy advisory firms ISS and Glass Lewis have both urged shareholders to reject the proposal. On Tuesday, Norges Bank Investment Management, which manages Norway’s $2 trillion sovereign wealth fund, also said it had voted against the pay package over concerns about the lack of mitigation of Musk’s “key person risk” for Tesla. The fund is Tesla’s sixth-largest institutional shareholder and the world’s largest wealth fund.
Musk called the proxy firms “corporate terrorists” during Tesla’s recent earnings call, and board chair Robyn Denholm warned shareholders in an October letter that Musk could walk away from the company if they don’t approve his compensation.
Tesla’s shares have recovered from a sharp downturn earlier in the year, but its sales face an uncertain future after the end of the EV tax credit in the US and increased competition from other automakers.
‘A pivotal juncture in Tesla’s history’
Tesla
Tesla and some of its executives have been on a messaging blitz as the shareholder meeting approached.
The company has paid for ads on X.com to promote the vote, released videos outlining the company’s voting recommendations, and board chair Robyn Denholm has made media appearances to make the case that it’s only fair that Musk get his payday.
“The Future of Tesla Is in Your Hands,” the company’s “votetesla.com” website reads.
“We are at a pivotal juncture in Tesla’s history, and the proposals the Special Committee has carefully designed and the Board has put forward will help determine Tesla’s future. If you believe, like us, that Elon is the CEO that can make our ambitious vision a reality, vote NOW,” the text says.
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