Tesla Board Chair Robyn Denholm issued a stark warning Monday, urging shareholders to approve CEO Elon Musk’s proposed pay package worth nearly $1 trillion, emphasizing that the company could lose significant value without him. Denholm noted that Musk is critical to Tesla’s evolution beyond being “just another car company,” particularly as the company pursues initiatives in Full Self Driving and its Optimus robot program.
Online shareholder votes for Musk’s new pay plan and other proposals must be received by 11:59 p.m. ET on Nov. 5, ahead of Tesla’s annual meeting on Nov. 6. Denholm stressed that the company is at an “important inflection point” with artificial intelligence, underscoring Musk’s unique contributions to Tesla’s future.
The proposed plan, unveiled by the board in September, consists of 12 tranches of shares tied to milestones. The first tranche is awarded at a market capitalization of $2 trillion, with subsequent tranches linked to market cap increases, reaching $8.5 trillion for the final tranche. Product goals include delivering 20 million Tesla vehicles, achieving 10 million active Full Self Driving subscriptions, producing 1 million Optimus robots, and operating 1 million commercial robotaxis. Additional milestones involve adjusted EBITDA targets ranging from $50 billion to $400 billion.
Even without meeting all targets, Musk could collect tens of billions of dollars, potentially more than $50 billion, by achieving a few attainable goals. The package would also increase Musk’s voting power, taking his stake from about 13% to roughly 25%. Denholm noted that Musk’s emphasis on voting influence is “less about compensation and more about the voting influence,” particularly regarding Tesla’s AI initiatives.
Several groups have opposed the pay plan, including Institutional Shareholder Services (ISS) and a coalition of unions and watchdogs that launched the “Take Back Tesla” campaign, criticizing Musk’s political stances and the package’s enormous value. Musk has publicly criticized proxy advisors ISS and Glass Lewis, calling them “corporate terrorists,” though both firms stand by their analyses.
In addition to voting on Musk’s pay, Denholm encouraged shareholders to re-elect board members Ira Ehrenpreis, Joe Gebbia, and Kathleen Wilson-Thompson. She noted that retail traders account for about 30% of Tesla’s shareholder base and highlighted record participation in last year’s vote.