Musk could become history’s first trillionaire as Tesla shareholders approve giant pay package.
NEW YORK (AP) — The world’s richest man was just handed a chance to become history’s first trillionaire.
Elon Musk won a shareholder vote on Thursday that would give the Tesla CEO stock worth $1 trillion if he hits certain performance targets over the next decade. The vote followed weeks of debate over his management record at the electric car maker and whether anyone deserved such unprecedented pay, drawing heated commentary from small investors to giant pension funds and even the pope.
In the end, more than 75% of voters approved the plan as shareholders gathered in Austin, Texas, for their annual meeting.
“Fantastic group of shareholders,” Musk said after the final vote was tallied, adding “Hang on to your Tesla stock.”
The vote is a resounding victory for Musk showing investors still have faith in him as Tesla struggles with plunging sales, market share and profits in no small part due to Musk himself. Car buyers fled the company this year as he has ventured into politics both in the U.S. and Europe, and trafficked in conspiracy theories.
The vote came just three days after a report from Europe showing Tesla car sales plunged again last month, including a 50% collapse in Germany.
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Still, many Tesla investors consider Musk as a sort of miracle man capable of stunning business feats, such as when he pulled Tesla from the brink of bankruptcy a half-dozen years ago to turn it into one of the world’s most valuable companies.
Even Tesla bull Dan Ives of Wedbush Securities was cautious, noting there are “still demand issues.”
Still, it was a blowout number with sales hitting 497,099 vehicles versus 462,890 in the same period last year. Analysts expected a small drop to 456,000.
Investors cheered Musk’s decision in April to leave Washington for Austin, Texas, where Tesla is headquartered. But he is still heavily involved in political and social wars, alienating potential car buyers.
On Wednesday, he posted on X that he was canceling his Netflix subscription because of critical comments made by the creator of a show on the streaming service, which appeared to spark a wave of cancellations in turn.
The sharp fall in Tesla stock Thursday was remarkable as investors have been surprisingly optimistic about the company in recent weeks despite terrible financial figures.
Investors drove the stock up 34% in September alone in a bet that Musk’s planned new cheaper version of his bestselling Model Y will recharge sales. Musk has also been successful in shifting investor attention away from cars to other aspects of the business — the rollout of its driverless robotaxi service planned for several cities and its Optimus robots for factory work and household chores.
Driving the stock higher has also been Musk’s apparent renewed focus on the company.
To hold his attention, Tesla’s board proposed last month a pay package that would allow Musk to earn $1 trillion if he meets certain financial goals over the next several years. The pay offer, unprecedented for U.S. companies known for outsized CEO compensation, drew criticism from Pope Leo in an interview lamenting widening income gaps.
If Musk meets the goals, he could set a record on top of his own record. He recently became the first person ever to hit $500 billion in net worth, at least according to rich list compiler Forbes magazine.
The 7% sales rise in the last quarter compares with a 13% dropped in the first three months of the year when Musk led Trump’s government cost-cutting efforts at the Department of Government Efficiency. In the following three months through June, sales plunged 13% again.
