Elon Musk has clinched a resounding victory as Tesla shareholders overwhelmingly approved his monumental US$1 trillion compensation package, a move that solidifies the billionaire's command over the electric vehicle giant and endorses his ambitious vision for an AI-driven future.
A Decisive Shareholder Mandate
The pay deal received robust support, with 75 per cent of votes cast at Tesla's annual meeting on Thursday, November 7, 2023, backing the record package. This marks Musk's second enormous stock award in consecutive years. Should he achieve all the outlined performance targets, this arrangement could augment his stake in Tesla by as much as 12 per cent, ultimately granting him control over a quarter of the company's shares.
This outcome arrives after months of intense scrutiny and debate, where many investors chose to prioritize Musk's visionary leadership and proven salesmanship over potential governance concerns. Under his direction, Tesla's market valuation has soared to an astounding US$1.4 trillion, a figure that now eclipses the combined value of all other Western automobile manufacturers.
Celebration and a Vision of the Future
The announcement triggered a celebratory atmosphere at Tesla's gigafactory in Texas. Musk took the stage to cheers from an audience of retail investors, triumphantly pumping his fists in the air. The event was personalized with supporters, including his brother and board member, Kimbal Musk, who applauded from the front row wearing his characteristic white cowboy hat.
The setting featured neon blue and purple lighting and a screen emblazoned with the slogan "sustainable abundance." In a display blending technology and showmanship, Musk danced to techno music alongside Tesla's prototype "Optimus" humanoid robots.
During more than an hour of impromptu remarks, Musk outlined a future transformed by artificial intelligence. He prophesied a world with ubiquitous self-driving cars and an "army" of Tesla robots capable of performing complex tasks like surgery, potentially surpassing human ability and helping to "eliminate poverty."
"With AI and robotics, you can actually increase the global economy by a factor of 10 or 100. There's not like an obvious limit," Musk told the captivated audience. He enthusiastically promoted the Optimus project, calling it "the biggest product of all time by far" and an "infinite money glitch," concluding with a direct piece of advice to shareholders: "I guess what I'm saying is, hang on to your Tesla stock."
Consolidating Control Amidst High Stakes
This annual meeting concludes a turbulent year for Tesla and its multifaceted CEO, whose fortune is estimated at US$460 billion from his ventures, including SpaceX and xAI. Some investors had expressed concerns that Musk's focus was being diverted, especially after his involvement in political affairs was linked to a downturn in Tesla's sales.
However, the overwhelming shareholder approval suggests that the primary concern for most was retaining Musk's leadership. The CEO had previously hinted that he might reduce his role or leave Tesla if the compensation package did not pass. The company's immense valuation is heavily predicated on market optimism regarding Musk's ability to successfully pivot Tesla into a leader in artificial intelligence and deploy a massive fleet of self-driving robotaxis.
Brian Quinn, a professor at Boston College Law School, contextualized the decision for shareholders: "What is Tesla worth without Musk or even a part-time Musk? Much less than it is worth now." This sentiment ultimately carried the day, mirroring a similar contentious vote last year where shareholders reapproved a US$56 billion pay package for Musk that had been voided by a Delaware judge.
