In a move that could be described as putting “trillion-dollar handcuffs” on its CEO, Tesla has proposed a revolutionary pay deal to secure Elon Musk’s leadership for the next ten years. The plan’s sheer scale is designed not only to reward Musk but also to ensure his primary focus remains on propelling Tesla to unprecedented heights.
The deal’s success hinges on Musk elevating Tesla’s market value from around $1 trillion to $8.5 trillion. Achieving this would grant him shares that could push his personal wealth past the $2 trillion mark, a figure previously confined to science fiction. The message from the board is clear: deliver historic growth, and you will receive a historic reward.
This aggressive strategy is being rolled out against a backdrop of concern among some investors. Musk’s acquisition of X (formerly Twitter) and his management of other companies like SpaceX have led to accusations that his attention is dangerously divided. The board’s proposal acts as a powerful counter-narrative, effectively betting that Musk’s vision, when properly incentivized, is the company’s greatest asset.
Ultimately, the decision rests with Tesla’s shareholders, who must vote on the package. The proposal is framed as a shared journey; Musk’s payday is directly contingent on a massive increase in the share price, meaning investors would also see enormous returns. This alignment is what Tesla hopes will persuade them to approve a deal that could redefine the limits of executive compensation.