“Mr Elon Musk, the world’s richest person, spent the end of Tesla’s earnings call pleading with investors to ratify his upcoming US$1 trillion pay package”
It’s great to see corporate earnings calls being used for their proper purpose and not for the personal benefit of the CEO.
A $1000,0000,0000,000 CEO pay deal for a company with a market cap under $1400,000,000,000… seems slightly generous, perhaps even a little extravagant.
Musk mentions his concern that he might go insane. Considering this remarkable quote from the earnings call, I understand his concern:
“I just don’t feel comfortable building a robot army here”
Why is this company trading at a record high?
Given the behaviour and demands of the CEO, Tesla’s price should drop so low that it could access rare earths directly from the planet’s volcanic core.
Way to either not understand, or intentionally misrepresent, the actual facts:
Musk gets his $1T only if TSLA’s market cap hits and sustains (30‑day and a six‑month trailing average) of $8.5T.
And even then, only if the following are all achieved:
• 20 million Tesla vehicles delivered, total
• 10 million paid Full Self-Driving (FSD) subscriptions on average over three consecutive months; free trials will not count
• 1 million “Bots” delivered (AI robots like Optimus), counted from the September 3 grant date
• 1 million driverless robotaxis in commercial service on average over three successive months
10-year time limit on achievements, vesting over 7.5 years for the first half, 10 years for the rest, Musk has to stay, etc.
I did personally vote against the pay package because:
• the 20 million vehicles happens even if the company is on cruise control
• if Musk really wants more voting power, he should sell Twitter to buy enough TSLA to gain voting percentage. Rememeber, he sold TSLA to buy Twitter, so his lack of voting power is all on him and his choices.
That said, there’s no denying what he has accomplished for Tesla/TSLA, but that was before he got distracted. The BoD’s plan doesn’t re-focus Musk - not nearly enough.
Ignoring the other measures for ease of discussion board typing, it means that if the company goes from $1.6T to $8.5T, he gets roughly $1T of that. So an improvement of roughly $7T nets him alone 14% of the improvement of the entire corporation. Is there any other CEO pay scale in history that is so remunerative?
Maybe he’s worth it, but I’d have to vote no, as well.
The correct question is, is there any CEO who can create such value? Please note, I have my own concerns on Tesla, including Musk commitment to the company. That pay package is showing some commitment issue is my view. But, without Musk, there is no tesla is something we cannot ignore.
Just now noticed in their attempt to make the numbers seem big, @TheReitStuff, gets it factually wrong:
“$1000,0000,0000,000 CEO pay deal” is $1,000Trillion, so off by 4 orders of magnitude, lol.
Typing is easy. Shouldn’t ignore the other measures because they potentially set the company up for even further success beyond the 10-year package horizon. If Tesla is successful in leading the market in Autonomy and Robotics, its stock price in 2035 will reflect even higher future potentials.
Musk already owns about 13% of the TSLA shares, so if TSLA’s market cap reaches $8.5T, he’ll have earned about $1.1T anyway. The full award would add another 16% of all TSLA shares to Musk.
When Jobs was fired from Apple, it was bad for Apple and for Jobs. If Musk quits Tesla, he’ll have to leave a lot behind. I wonder what being headquartered in Texas means for potential employee poaching and anti-compete employee contracts?
Without Tesla’s fleet of vehicles, can Musk pursue autonomy at the same pace, and how much time does he lose trying to restart all that? Robotics is probably an easier thing to start anew, but without Tesla’s vehicle sales FCF he’ll have a harder time ramping up. One thing that would be fun to watch is if he’s no longer at Tesla, how much time could he devote to Twitter while starting up new ventures? Th world is different now than when Jobs started NeXT, but is that enough?
Apparently indirect shareholders have someone else voting for them … it’s not really “fair”, but I don’t know how it could work otherwise. If you own an S&P500, for example, if you as an indirect holder had to vote, you would have to vote on about 500 of them!
This is correct and it is worth noting that Vanguard - which owns about 7% of all outstanding shares (as of 2024) voted NO in 2018 but voted yes in 2024 on this topic. It will be interesting to see how mutual fund companies vote this time.
My guess is the desperation has them thinking there is a decent chance it gets voted down.
I wonder if both big institutional investors and the proxy-advisory firms are also thinking about potential impacts outside of Tesla.
As we’ve discussed in other threads, there’s been nothing like this package in the history of executive compensation anywhere for any company. Previously, a very well-paid CEO might earn a few tens of millions per year, and a pay packet might reach a hundred million or two to be the highest paid CEO in all of capitalism for that given year. Now, Musk is proposing to pocket several billions of dollars in compensation for market-matching (or -trailing) returns for the first two or three tranches. If other multi-trillion companies like NVDA or AAPL or MSFT were to follow suit, and ratchet up CEO comp from the current levels by an order of magnitude or three, it would materially affect returns to investors in these big funds well beyond what happens with Tesla.
Another reason I voted against the pay package is that it doesn’t provide a Succession Plan in case something happens to Musk. He could get hit by a bus, a RoboVan, a Starlink satellite falling out of the sky, etc. And all the people we old-time TSLA shareholders used to think of as successors: JB Straubel, Jérôme Guillen, etc. are gone.
Finally, if this really were about voting power and not money, as Musk claims, Tesla would have created a super-voting class of shares, much like Ford has had, and Google (Alphabet) recently added.
I read a piece that says between 7 and 14 Starlink satellites fall out of the sky every week! It’s a function of the low-earth orbit and the resistance to the atmosphere, which the higher orbit/geosynchronous satellites don’t face.
That’s not the real reason they have so many launches! (I assume you were kidding). They have so many launches because they are expanding like mad.
As far as the vote is concerned, this time around, because they are now a Texas corporation. Elon and other folks close to the issue are permitted to vote their own shares (whereas in Delaware they were not permitted). Many of the big mutual fund firms have voted “FOR” (Vanguard, BlackRock, Fidelity, etc). I think only State Street voted “AGAINST” so far. I too have voted “FOR”, it would be folly to vote in such a way that Musk may leave, he’s a once in a generation or three type of guy, it’s akin to when they removed Steve Jobs from Apple and nearly destroyed it.
It’s about both. Eventually the Mars colonization thing is going to cost hundreds of billions or even trillions of dollars. And Musk knows that nobody would be willing to fund something so very forward looking that isn’t likely to realize any real return in terms of money, and in fact would likely become an eternal money sink. However, it may (just “may”, it’s still a small probability regardless of how much money is thrown at it) have a superbly real return for humanity. I suspect that that is what he wants to be his legacy, he doesn’t care about passing billions or hundreds of billions to his heirs.
Or if not the Mars thing, some other crazy futuristic idea that Musk will have at some point. Could be anything, but it’ll always be very expensive to do big things.
OK, can you share where you got that info? Again, I went looking for it yesterday and could not find verification, specifically for Fidelity and Vanguard, as to how they voted or planned to vote. I could find out how they voted in 2024, but not for this vote.
How did fidelity vote on the 2025 musk pay package?
Google AI states:
Fidelity hasn’t yet publicly disclosed its vote on the 2025 Musk pay package, though it urged investors to vote against it in early October 2025, citing declining company performance. However, Fidelity previously sided with Tesla management in past controversial votes, including one in 2018 related to Musk’s pay and going private, although they haven’t commented on future decisions.
