Tesla (Nasdaq: TSLA) CEO Elon Musk has threatened to resign if shareholders reject his compensation package at next month’s vote. He indicated on X that he would not continue as Tesla’s chief executive if the board’s proposed pay package fails to pass at the November 6 shareholder meeting.
The controversial package could grant Musk stock options worth up to $1 trillion, according to industry reports. This would be the largest compensation package in corporate history, coming as Tesla’s second-quarter deliveries dropped 13% compared to the prior year.
The compensation structure could reward Musk even if Tesla underperforms market averages. A Reuters analysis found that under the package’s terms, Musk could receive payouts worth $20 billion to $40 billion with below-average returns.
Related: Federal Probe Opens Into Tesla’s Full Self-Driving Technology
Tesla commands a valuation of roughly $1.4 trillion, exceeding what investors assign to all other car manufacturers worldwide combined, despite the company producing far fewer vehicles than competitors like Toyota and Volkswagen. Analysts attribute much of Tesla’s valuation to investor expectations about future autonomous vehicle and robotics products rather than current automotive sales.
The shareholder vote comes as challenges continue to mount for Tesla, including two consecutive years of sales declines, a new federal probe, and increased competition in the electric vehicle market.
Information for this story was found via Electrek, Bloomberg, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
One Response
Con man, grifter and figure head. This company functions on speculation….and Elon is the front man, however his missteps has cost them of late. Perhaps a full on rethink is needed.