(Reuters) -Tesla's board has proposed a $1 trillion compensation plan for CEO Elon Musk in what would be the largest corporate pay package in history, underscoring the hold Musk has over the carmaker as it attempts to transform into an AI and robotics powerhouse.
The world's richest person has consistently said he needs more of a stake in the company, even as a legal battle over his 2018 pay package - then valued at a mere $56 billion - continues.
The regulatory filing puts Musk on a different plane
than other technology executives, saying that "traditional compensation packages granted to executives at other companies were determined to not be appropriate for designing Mr. Musk’s incentive compensation."
The proposed plan would grant Musk up to 12% of Tesla's stock, worth about $1.03 trillion if the company hits its target market value of $8.6 trillion. The plan requires boosting Tesla's valuation nearly eightfold, or about $7.5 trillion, over the next decade.
If fully earned, the award would materially increase Musk’s voting power from his roughly 13% stake, intensifying debate over governance and succession.
Musk would receive no salary or cash bonus under the proposal, with the compensation is tied to stock awards that vest only if Tesla meets both market cap and operational targets, such as selling millions of EVs, deploying robotaxis, and delivering AI-powered humanoid robots.
The company's shares were up about 2% in premarket trading.
Tesla's board earlier this year approved an interim compensation package for CEO Elon Musk worth about $29 billion in restricted stock, designed to keep him at the helm through at least 2030 as the company pivots to an AI-first strategy.
Tesla moved its corporate base from Delaware to Texas in 2024 after a Delaware judge twice voided Musk’s 2018 package. The appeal remains pending at the state’s Supreme Court.
(Reporting by Akash Sriram in Bengaluru; Editing by Anil D'Silva and Saumyadeb Chakrabarty)
