Tesla board warns shareholders: Approve Musk’s $878B pay deal, or risk losing him
Tesla’s board has placed its biggest bet yet on CEO Elon Musk, urging shareholders to approve a compensation package worth up to $878 billion or risk Musk walking away from the company — a move they say could send Tesla’s market value tumbling.
Investors will vote Thursday in what is effectively a referendum on whether one executive should command unprecedented power and pay at one of the world’s most valuable companies, News.Az reports, citing Reuters.
Tesla directors argue that only Musk can deliver on the company’s bold promises — from scaling robotaxis to building humanoid robots — positioning Tesla as a dominant AI-driven mobility and robotics giant worth as much as $8.5 trillion within a decade.
“If the stock is going to go up sixfold … why do I care what he makes?” said Nancy Tengler of Laffer Tengler Investments, reflecting the view of bullish investors convinced Musk alone can deliver Tesla’s next era.
But critics — including major pension funds like CalPERS and Norway’s Norges Bank — call the package reckless, warning it concentrates too much power in one leader with conflicts of interest and multiple external ventures.
They argue Tesla is being held hostage by a “superstar CEO” who is signaling he could prioritize SpaceX, xAI, or Neuralink if the board refuses his terms.
“This is a guy holding a gun to his own head, saying: ‘Give me a trillion dollars,’” said Yale’s Gautam Mukunda. “It’s not the board’s job to nod like a bobblehead doll.”
The vote comes after a Delaware court struck down Musk’s prior $56 billion package as tainted by board conflicts. Tesla has since moved its corporate home to Texas, where shareholder lawsuits face higher barriers.
Musk can vote his 15% stake this time — a potentially decisive advantage.
Supporters say Musk’s incentive aligns with explosive value creation. Critics say the board has failed to plan for leadership succession, exposing Tesla to key-person risk unprecedented in modern corporate governance.
For now, Musk’s message is simple: back the vision — and the payout — or watch Tesla risk losing its architect.
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