Tesla to give Elon Musk $29 billion in stock to keep him as CEO

[midian182]

What just happened? You probably imagine that as the richest person in the world with a net worth of around $352 billion, Elon Musk has enough money. But the CEO looks set to become even richer after Tesla awarded him an interim pay package of 96 million shares of restricted stock valued at approximately $29 billion. The compensation is to "incentivize" Musk to stay as the head of Tesla during the battle against a court ruling that voided his original $50 billion package from 2018.

At the start of 2024, Delaware Court Judge Kathaleen St. J. McCormick voided Musk's 2018 $50 billion compensation package. Shareholder Richard Tornetta had filed a lawsuit at the time after the EV giant granted Musk the largest executive compensation package in history.

Tornetta accused Tesla of breaching its fiduciary duty by unjustly enriching its CEO, the board of directors acting without independence, and Musk of dictating negotiations. But Tesla's directors argued that the size of the compensation package was necessary to ensure Musk dedicated his attention to Tesla.

McCormick ruled that Musk wielded the maximum influence at Tesla that a manager can have over a company, and that the deal was unfair to shareholders.

Tesla shareholders twice voted to give Musk his compensation, but McCormick upheld her decision to block it, most recently in December. In January, Tesla said it would appeal the judge's decision to the Delaware Supreme Court.

The case is also notable for the $7.6 billion worth of stock the lawyers who fought against Musk asked for as payment. The judge said they were entitled to $345 million. Musk also moved Tesla's and SpaceX's state of incorporation from Delaware to Texas as a result of the case.

The public vote is unequivocally in favor of Texas!

Tesla will move immediately to hold a shareholder vote to transfer state of incorporation to Texas. https://t.co/ParwqQvS3d

– Elon Musk (@elonmusk) February 1, 2024

Tesla's brand and image have suffered as a result of Musk's former friendship with Donald Trump and his tenure at DOGE. Its stock is down around 19% since the start of the year, and its deliveries were down roughly 13% YoY for both quarters.

However, Tesla still has plenty of faith in its leader. It set up a special committee earlier this year to look at new ways of compensating Musk, who the board says "has not received meaningful compensation for eight years."

Tesla's year-to-date stock price

Should the Delaware appeal court decide to reverse McCormick's decision and hand Musk his 2018 pay package, the $29 billion interim grant would be forfeited or offset. By accepting the stock, Musk is agreeing to continue as Tesla CEO until 2027.

Shareholders will vote on the new deal at their annual meeting on November 6.

I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control. Enough to be influential, but not so much that I can't be overturned.

Unless that is the case, I would prefer to build products outside of Tesla. You don't seem to understand…

– Elon Musk (@elonmusk) January 15, 2024

Musk remains Tesla's largest shareholder with a 13% stake. But he previously issued an ultimatum to Tesla stating that unless his ownership in the company increased to 25%, he would be "uncomfortable growing Tesla to be a leader in AI & robotics."

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Tesla to give Elon Musk $29 billion in stock to keep him as CEO

 

[seeprime]

Let him go. He got Tesla moving fast when it neded to do so. Now, his vision is obscured compared to a decade ago. Get a couple of new models, including an SUV, and move into the future. Musk seems distracted and stuck in his old ways. Let him focus on SpaceX and getting Starship working consistently.

 

[DrSuess]

He was never stepping down as CEO, his ego wouldn't let him. The only way Musk leaves Tesla is by force.

 

[Alfonso Maruccia]

*

 

[pnntmp]

Well, good for Tesla.
The shareholders are apparently smart and know what's in their best interest.

The attempts of the woke to boycott Tesla is a temporary nuisance, they develop and manufacture a lot of other stuff that's not so sexy but is equally important, and the robot business is about to skyrocket. Only a complete idi0t may let the driving force behind all that leave.

Never bet against Musk is something smart money grasped long ago.

 

[AlexIL]

The real question here is how much they overcharge for their products and underpay their workers if they can afford paying billions to CEO. Hipocrytes.

 

[lonetac]

Gov subsidies should be stripped from this company. Period. Thats waste, I dont understand how DOGE didnt flag this yet did health care, veterans benefits and things that help the nations poorest...

You cannot justify giving subsidies to corpos that have this much money to pay their CEO.

 

[VitalyT]

They want to pay him 29bln to stay as CEO? I thought they wanted to spend that much to kick him out and replace without someone who understands what a good car is. I am now confused.

Tesla continues producing some of the worst-quality vehicles, with terribly misaligned panels, the body sewn up from 100 pieces, horrible sealing all over and cheap-arse interiors.

 

[maxxcool7421]

He was never stepping down as CEO, his ego wouldn't let him. The only way Musk leaves Tesla is by force.

A drone would do it

 

[RudyBob]

I'm glad he is getting paid his fair share.

 

[Plutoisaplanet]

Gov subsidies should be stripped from this company. Period. Thats waste, I dont understand how DOGE didnt flag this yet did health care, veterans benefits and things that help the nations poorest...

You cannot justify giving subsidies to corpos that have this much money to pay their CEO.

According to this, Tesla hasn't received any subsidies from the Federal government since 2015, so that would do nothing. The vast majority of the subsidies listed for Tesla went to its subsidiaries from before they were acquired by Tesla. The one subsidy it did receive was a loan in 2010 that was paid back fully. You may be thinking of tax credits but these go to taxpayers instead of Tesla, which Elon Musk has long been in favor of cancelling.

Subsidy Tracker

Subsidy Tracker, produced by the Corporate Research Project of Good Jobs First, is a wide-ranging database on misconduct by large and small corporations throughout the United States.

subsidytracker.goodjobsfirst.org

They want to pay him 29bln to stay as CEO? I thought they wanted to spend that much to kick him out and replace without someone who understands what a good car is. I am now confused.

Tesla continues producing some of the worst-quality vehicles, with terribly misaligned panels, the body sewn up from 100 pieces, horrible sealing all over and cheap-arse interiors.

You're confused because investors of Tesla always wanted a CEO who was paid. The original pay package was performance based, and few thought Tesla would even meet those criteria. Years after Tesla achieved all the milestones is when the pay package got tied up in the courts, despite investors benefiting greatly from the performance it incentivized. For example, I've made around 20x returns on my investment in Tesla since before the 2018 pay package.

 

[airbornex]

It is kind of surreal watching the richest person on Earth get handed another $29 billion because he might leave his own company. The fact that a Delaware judge struck down the original $50 billion package and the board's response was basically to say okay, how about $29 billion instead, says a lot about Tesla's governance structure.

 

[maxxcool7421]

It is kind of surreal watching the richest person on Earth get handed another $29 billion because he might leave his own company. The fact that a Delaware judge struck down the original $50 billion package and the board's response was basically to say okay, how about $29 billion instead, says a lot about Tesla's governance structure.

Board : "Let's use 79 BILLION DOLLARS to boost research to make better cars.......na lets give it to the guy who hates jews, loves lil'trumpy and feels bad for Diddy~diddler ..."

 

[Plutoisaplanet]

It is kind of surreal watching the richest person on Earth get handed another $29 billion because he might leave his own company. The fact that a Delaware judge struck down the original $50 billion package and the board's response was basically to say okay, how about $29 billion instead, says a lot about Tesla's governance structure.

How do you think he got that money? Decades ago, he put every dollar he had to his name into Tesla and SpaceX and the companies slowly became massively successful. Not many CEOs do that. Bill Gates was one of the few before him and he was also the richest man in the world for a long time.

Besides, any good board isn’t responsible for making some judge happy, it’s responsible for making its shareholders happy. Considering the gripe of the judge was how the board offered that compensation (and not how much it was), there’s a good chance this will go through fine.

 

[Che Cazzo]

The ***** has ruined Tesla and drove its stock into the ground (pick your reasons, there are many, start with his DOGE obsession while being AWOL at the company).

And what does the board of kowtowing minions do?? Throw more billions at him!!

Only in the US, are bumbling, incompetent CEOs rewarded so lavishly. The underbelly of of pathetic American capitalism is in full display. As if we needed more proof.....

 

[bviktor]

The board is full of musks family, in case you were wondering.

 

[bclaymiles]

The real question here is how much they overcharge for their products and underpay their workers if they can afford paying billions to CEO. Hipocrytes.

They didn't pay billions to the CEO. Why this small but critical fact is overlooked by so many people baffles me.

 

[bclaymiles]

The board is full of musks family, in case you were wondering.

Elon's brother Kimbal is on the BoD. As is Elon.

You have a strange definition of "full of".

 

[bclaymiles]

The ***** has ruined Tesla and drove its stock into the ground (pick your reasons, there are many, start with his DOGE obsession while being AWOL at the company).

TSLA stock hasn't been driven into the ground. It's down from a peak in Dec 2024, but otherwise is well within its historical range.

And what does the board of kowtowing minions do?? Throw more billions at him!!

It's a restricted stock award. The shares vest over the next five years, and during that time he can't sell, transfer, or dispose of them. In other words, the stock grant as of today is worth zero dollars and zero cents. They literally haven't thrown even five cents at him.

Only in the US, are bumbling, incompetent CEOs rewarded so lavishly. The underbelly of of pathetic American capitalism is in full display. As if we needed more proof.....

One of the most successful entrepreneurs on the planet. If you consider American capitalism "pathetic", well, you do you (while you reap the rewards of said capitalism every single day of your life - regardless of whether you're an American or not).

 

[bclaymiles]

It is kind of surreal watching the richest person on Earth get handed another $29 billion because he might leave his own company. The fact that a Delaware judge struck down the original $50 billion package and the board's response was basically to say okay, how about $29 billion instead, says a lot about Tesla's governance structure.

Musk hasn't been handed a penny. The $29 billion figure is fictional, at least until the five year vesting is complete, at which point it could be zero or it could be $100 billion.

 

[lonetac]

According to this, Tesla hasn't received any subsidies from the Federal government since 2015, so that would do nothing. The vast majority of the subsidies listed for Tesla went to its subsidiaries from before they were acquired by Tesla. The one subsidy it did receive was a loan in 2010 that was paid back fully. You may be thinking of tax credits but these go to taxpayers instead of Tesla, which Elon Musk has long been in favor of cancelling.

Subsidy Tracker

Subsidy Tracker, produced by the Corporate Research Project of Good Jobs First, is a wide-ranging database on misconduct by large and small corporations throughout the United States.

subsidytracker.goodjobsfirst.org

You're confused because investors of Tesla always wanted a CEO who was paid. The original pay package was performance based, and few thought Tesla would even meet those criteria. Years after Tesla achieved all the milestones is when the pay package got tied up in the courts, despite investors benefiting greatly from the performance it incentivized. For example, I've made around 20x returns on my investment in Tesla since before the 2018 pay package.

Tesla has received roughly 38 billion dollars of our tax dollars. No matter how you chop it up, if they can give this much to Elon, they didnt need our tax dollars and the tax dollars shouldnt be going to Tesla.

"Over the years, Musk and his businesses have received at least $38 billion in government contracts, loans, subsidies and tax credits, often at critical moments, a Washington Post analysis has found, helping seed the growth that has made him the world’s richest person."

"Nearly two-thirds of the $38 billion in funds have been promised to Musk’s businesses in the past five years."

"“Tesla would not have survived without the loan,” said a former high-level Tesla employee familiar with the company’s finances, who spoke on the condition of anonymity for fear of retribution. “It was a critical loan at a critical time.”"

Seems to me the billionaires are just piggy backing off the American people. The failed car company should sink like any other business and not be bailed out by tax payers.

Our taxes should be spent on us, not making the richest person in the world richer. This isnt a hard concept.

https://www.washingtonpost.com/technology/interactive/2025/elon-musk-business-government-contracts-funding/

 

[Rudyduu]

According to this, Tesla hasn't received any subsidies from the Federal government since 2015, so that would do nothing. The vast majority of the subsidies listed for Tesla went to its subsidiaries from before they were acquired by Tesla. The one subsidy it did receive was a loan in 2010 that was paid back fully. You may be thinking of tax credits but these go to taxpayers instead of Tesla, which Elon Musk has long been in favor of cancelling.

Subsidy Tracker

Subsidy Tracker, produced by the Corporate Research Project of Good Jobs First, is a wide-ranging database on misconduct by large and small corporations throughout the United States.

subsidytracker.goodjobsfirst.org

You're confused because investors of Tesla always wanted a CEO who was paid. The original pay package was performance based, and few thought Tesla would even meet those criteria. Years after Tesla achieved all the milestones is when the pay package got tied up in the courts, despite investors benefiting greatly from the performance it incentivized. For example, I've made around 20x returns on my investment in Tesla since before the 2018 pay package.

That is not true, the company was on its way to meet any performance milestones when the compensation package was put together, this is all in the court case. The board is made entirely of Elon's personal friends and current/former employees.

Tesla and other electric cars were subsidized until recently.

Electric cars aren't that popular with the right leaning politics. If Elon didn't get involved with politics and he didn't post his opinion about everything on social media Tesla would be a lot more successful today than if Elon left the company. He wasn't running the company the last few months, at least, anyway. How much time could he possibly spend with all of the companies he's the CEO?

 

[Plutoisaplanet]

Tesla has received roughly 38 billion dollars of our tax dollars. No matter how you chop it up, if they can give this much to Elon, they didnt need our tax dollars and the tax dollars shouldnt be going to Tesla.

"Over the years, Musk and his businesses have received at least $38 billion in government contracts, loans, subsidies and tax credits, often at critical moments, a Washington Post analysis has found, helping seed the growth that has made him the world’s richest person."

"Nearly two-thirds of the $38 billion in funds have been promised to Musk’s businesses in the past five years."

"“Tesla would not have survived without the loan,” said a former high-level Tesla employee familiar with the company’s finances, who spoke on the condition of anonymity for fear of retribution. “It was a critical loan at a critical time.”"

Seems to me the billionaires are just piggy backing off the American people. The failed car company should sink like any other business and not be bailed out by tax payers.

Our taxes should be spent on us, not making the richest person in the world richer. This isnt a hard concept.

https://www.washingtonpost.com/technology/interactive/2025/elon-musk-business-government-contracts-funding/

We were talking about DOGE, that means federal funding. NOW you're talking about all sources of government funding to all of Elon Musk's companies for some reason. These are two completely different things.

You also can't complain about your tax dollars going to Tesla if you didn't pay taxes to that state. Each state primarily subsidized new Tesla factories through tax rebates that provided jobs to its residents (NV, NY, and TX). And going back to FEDERAL subsidies like I said, the loan (the one you reference) was paid back in a few years and it was worth $465M in 2010. That's basically all Tesla itself got from the FEDERAL government. Unlike other loans given out at that time by the DOE, Tesla did not let it go to waste.

That is not true, the company was on its way to meet any performance milestones when the compensation package was put together, this is all in the court case. The board is made entirely of Elon's personal friends and current/former employees.

You should probably look at the milestones themselves because you're blatantly wrong.

There were two sets of milestones... Operational performance and stock performance. At the beginning of 2018 when it was introduced, fewer than 10,000 Model 3's were produced, they were losing money, and most of the media did not expect the success that you suggest. In addition, Tesla's market cap was worth about $50B and it had not had meaningful gains for 5 years prior. For Elon Musk to be paid anything, he needed to double the stock market cap, and either double the revenue or triple the EBITDA. That would've given him 1/12 of the pay, and he could not sell the stocks for 5 years afterwards.

https://www.cnbc.com/2018/03/21/tesla-shareholders-approve-elon-musks-multibilion-dollar-compensation-plan.html

In the end, Tesla's performance under Musk went from an EBITDA of $644M to $19B in 2022 and revenue went from $11.8B to $88B in 2023. Stock performance rose from $52B market cap to over $1T in 2021. There's no way you could claim Tesla was already going to achieve those, when I as an investor at the time could only hope for my money to 10x let alone 20x. CNBC said MANY experts claimed reaching the final milestones was "laughably impossible", CNBC called the milestones jaw-dropping, critics said it was just a publicity stunt, the package was similar to a 2012 one (while it still wasn't complete at the time), and CNBC also said "as executive compensation plans go, Tesla’s is about as friendly to shareholders as they come":

https://www.cnbc.com/2018/01/23/teslas-pay-deal-to-keep-elon-musk-all-or-nothing.html

In reality the judge that made that decision made a landmark decision that still hasn't been challenged yet and will probably be overturned. Multiple companies have left Delaware over it because it goes against the incorporation-friendly nature of Delaware's business laws.

 

[lonetac]

We were talking about DOGE, that means federal funding. NOW you're talking about all sources of government funding to all of Elon Musk's companies for some reason. These are two completely different things.

You also can't complain about your tax dollars going to Tesla if you didn't pay taxes to that state. Each state primarily subsidized new Tesla factories through tax rebates that provided jobs to its residents (NV, NY, and TX). And going back to FEDERAL subsidies like I said, the loan (the one you reference) was paid back in a few years and it was worth $465M in 2010. That's basically all Tesla itself got from the FEDERAL government. Unlike other loans given out at that time by the DOE, Tesla did not let it go to waste.

I was talking about our tax dollars. It was a joke that DOGE didnt cut Tesla funding but it went over your head. Lighten up. Obv DOGE isnt going to cut its dear leaders funding.

And yes, I can complain about my tax dollars going to Tesla until the cows come home because its extortion on the US tax payers. We cant have health insurance, housing, feeding starving people, SS, veteran benefits, national museums, etc. They all have to be cut but we have money for Elon's failed car company that wouldnt exist without tax payers money.

I am tired of my money going to bail out billionaires. There is no word salad you can talk your way out of.

38 billion is a lot of our money going to something that it shouldnt and should never have.

 

[Plutoisaplanet]

I was talking about our tax dollars. It was a joke that DOGE didnt cut Tesla funding but it went over your head. Lighten up. Obv DOGE isnt going to cut its dear leaders funding.

And yes, I can complain about my tax dollars going to Tesla until the cows come home because its extortion on the US tax payers. We cant have health insurance, housing, feeding starving people, SS, veteran benefits, national museums, etc. They all have to be cut but we have money for Elon's failed car company that wouldnt exist without tax payers money.

I am tired of my money going to bail out billionaires. There is no word salad you can talk your way out of.

38 billion is a lot of our money going to something that it shouldnt and should never have.

You must have zero reading comprehension. I'm saying I found that there's no funding from the federal government going to Tesla. What is there for DOGE to cut if nothing is going to Tesla? And again, 38 billion is not going to Tesla from the federal government. Why don't you actually read my post, or are you a bot? I'm just repeating myself at this point.