Tesla shareholders have officially ratified a substantial 10-year stock option package for CEO Elon Musk, potentially setting the stage for him to become history’s first trillionaire. The approval, finalized at the electric vehicle manufacturer’s annual meeting, grants Musk up to 423.7 million additional shares contingent upon the company achieving aggressive operational and market capitalization targets, reinforcing his commitment to steering Tesla’s transition into an artificial intelligence and robotics powerhouse amid recent financial headwinds.
The controversial remuneration plan received support from over 75% of the votes cast by independent shareholders, excluding Musk’s existing stake of approximately 15%. This landmark performance-based award, which grants no salary, is structured in 12 equal tranches. Full vesting of the stock options hinges on Tesla successfully reaching a staggering market capitalization of roughly $8.5 trillion—a valuation that would surpass the $5 trillion record recently set by Nvidia by over 70%. Should all milestones be met, the value of the full grant could reach $1 trillion, representing a 466% increase from the current share price.
Driving Strategy Through Ownership
The compensation package was defended by the board, which underscored the critical need to retain Musk’s leadership and vision. Board members had previously warned investors that a rejection of the grant might prompt Musk to seek opportunities elsewhere, particularly given his stated desire for greater voting influence to solidify the company’s long-term strategic direction. Musk, whose current net worth is estimated by Bloomberg to be around $473 billion, largely tied to his holdings in Tesla, SpaceX, and xAI, assured investors the grant’s purpose is securing sufficient control to drive future innovation rather than increasing personal wealth.
This substantial backing comes during a complex period for the Austin, Texas-based company. Tesla experienced declining sales and profits in the first half of the year, facing potential revenue headwinds as U.S. consumer support for traditional electric vehicles moderates.
Key Performance Milestones Required for Vesting:
- Achieving a series of ambitious financial and operational targets.
- Sustained growth in market capitalization culminating at $8.5 trillion.
- Maintaining leadership in innovation spanning autonomy and robotics.
The Robotics and Autonomy Pivot
Musk and senior executives are championing the narrative that Tesla is evolving beyond a conventional automotive manufacturer and transforming into a broader technology platform centered on advanced autonomy and robotics. This transition includes the development of robotaxis, full self-driving (FSD) software (which still requires driver supervision), and humanoid robots, such as “Optimus.”
In remarks to attendees, Musk articulated an ambitious vision for the robotics unit, predicting it could eventually eclipse the revenue generated by the automotive division, potentially becoming the world’s most valuable product category. He projected that Optimus units could be manufactured for about $20,000 and sold around the price of a mid-range passenger car. While these futuristic concepts—ranging from medical applications to significant economic transformation—remain in the development phase without commercial realization, they represent the high-stakes, long-term gambit that shareholders have now implicitly supported.
The approval ensures Musk has the necessary alignment and incentive to focus on these demanding, decade-long milestones. Given the immense performance thresholds, the reality of receiving the shares depends entirely on Tesla’s ability to navigate current market challenges and execute on its massive technological pivot. The decision locks in Musk’s powerful influence, tying his financial future directly to Tesla’s ability to dominate the emerging fields of advanced AI and autonomous hardware.