Is Musk's Big Payday Make-or-Break for Tesla's Share Price?
The question facing investors is how much Elon Musk should be paid if he manages to boost Tesla’s share price nearly six-fold over the next decade. Ahead of Tesla’s annual shareholder meeting on 6 November, shares have already risen in anticipation.
Musk’s $1 Trillion Pay Proposal
At the center of attention is Musk’s proposed compensation plan, potentially worth up to $1 trillion. The debate isn’t limited to his payment—it’s also about what might happen if the deal is rejected and Musk decides to step away from Tesla.
“My fundamental concern … if I go ahead and build this enormous robot army, can I just be ousted at some point in the future?“ — Elon Musk
The deal isn’t about direct cash but a stock-based package. It would only reach its full value if Musk meets several ambitious performance milestones. Should he succeed, Tesla’s market capitalization could rise from its current $1.5 trillion to about $8.5 trillion within ten years.
Investor Reactions
Some shareholders believe the potential gains justify the payout. Ark Invest CEO Cathie Wood, for example, has projected a Tesla share price of $2,600 by 2029, which aligns closely with Musk’s market cap target.
However, not all investors are on board. Norway’s sovereign wealth fund, which owns around 1.2% of Tesla, has expressed opposition to the compensation proposal, reflecting a divide among major stakeholders.
Summary
If approved, Musk’s unprecedented compensation plan ties his earnings directly to Tesla’s future success—a high-stakes wager on both innovation and leadership continuity.
Author’s summary: Tesla’s shareholders face a defining choice—approve Musk’s record-breaking $1 trillion pay for potential historic growth, or risk his possible exit and leadership uncertainty.