On Thursday, Tesla shareholders approved Elon Musk’s multibillion-dollar compensation package, which provides the CEO with the opportunity to earn up to $1 trillion contingent upon achieving a series of long-term performance objectives. Over 75% of shareholders supported the proposal during the meeting, and the announcement was greeted with enthusiasm. “What we are about to initiate is not just a new chapter in Tesla’s future, but an entirely new book,” Musk stated to the audience upon taking the stage. The compensation package is structured to ensure Musk remains with Tesla long enough to realize the technological ambitions he has established for the company. Musk has asserted that Tesla’s advancements in fields such as artificial intelligence, autonomous driving technology, and robotics will position it ahead of its rivals. Should Musk fulfill all the objectives outlined in the plan, he could potentially become the world’s first trillionaire.
Musk currently possesses a net worth exceeding $500 billion and is recognized as the richest individual globally according to Forbes’ real-time billionaire rankings. As per the approved plan, he is required to achieve several milestones associated with Tesla’s market value in order to obtain the complete package. The initial portion becomes accessible when Tesla attains a market value of $2 trillion. Additionally, the package encompasses objectives related to operating profit and product launches, including the delivery of 20 million Tesla vehicles. The plan is designed to ensure Musk remains with Tesla for a minimum of seven and a half years. Musk has expressed that Tesla’s growth potential is substantial, declaring in July that “Tesla will be the most valuable company in the world by far” if the company fulfills its targets for autonomous driving and artificial intelligence.
How Musk could potentially obtain the $1 trillion?
Musk will only be eligible for the payout if he meets the necessary operational and financial objectives. These targets include the delivery of 20 million vehicles over a span of 10 years. This figure is more than double the total number of vehicles Tesla has manufactured in the previous 12 years. Additionally, he must enhance the company’s market valuation and operating profits, as well as manage the delivery of one million robots. To date, Tesla has not yet delivered any robots. Even if Musk fails to achieve all the specified goals, he may still qualify for a substantial payout. He stands to receive $50 billion in Tesla shares if he increases the company’s market value by 80%, doubles vehicle sales, and triples operating profit — or fulfills any two of the other operational objectives.
