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Tesla Shareholders Face Big Decision on Musk’s $1 Trillion Pay and xAI Deal
AUSTIN, Texas — Tesla shareholders have begun voting on two major proposals ahead of the company’s annual meeting in November: a pay package for CEO Elon Musk that could reach $1 trillion and a potential investment in his artificial intelligence startup, xAI.....KINDLY READ THE FULL STORY HERE▶
The vote will be finalized at the 2025 Annual Shareholder Meeting scheduled for Nov. 6 at Tesla’s Gigafactory in Austin, Texas.
The most high-profile issue is Musk’s new compensation plan, which is tied to ambitious performance targets. If Tesla meets those goals, Musk could receive stock-based rewards worth up to $1 trillion, making it one of the largest executive pay packages in corporate history.
Tesla’s board of directors has endorsed the plan, arguing it is necessary to retain Musk as he divides his time between several high-profile ventures, including SpaceX, xAI and social media platform X.
“The board believes Elon’s leadership is essential for Tesla’s growth and innovation,” the company said in a statement to shareholders.
The second proposal asks investors to authorize Tesla to invest directly in xAI, Musk’s artificial intelligence company launched last year. Unlike the pay package, the board has not taken a position on this plan, citing potential conflicts of interest because Musk controls both Tesla and xAI.
Shareholders will be able to cast votes online or through their brokers until the deadline in early November. Tesla has released detailed instructions and voting guides to encourage retail investors to participate. The company has also reminded investors that every share counts, as turnout often determines close corporate votes.
Musk’s pay package has drawn criticism from governance experts and some investor groups. They argue that the scale of the reward is excessive and risks tying Tesla’s fortunes too closely to one individual. Others note that Musk already holds a large ownership stake in Tesla, giving him strong incentive to succeed.
“The package is breathtaking in size and raises questions about fairness to other shareholders,” said Charles Elson, a corporate governance specialist not involved with the vote. “It also reflects the unique dependence Tesla has on Musk’s vision and ability.”
Supporters counter that Musk has repeatedly delivered breakthroughs that transformed Tesla from a niche electric carmaker into one of the world’s most valuable automakers. They point to his track record of meeting difficult targets under a previous 2018 pay plan, which helped push Tesla’s market capitalization above $1 trillion.
The xAI proposal has also stirred debate. Backers say an investment could give Tesla access to cutting-edge artificial intelligence that might benefit its self-driving car technology and energy products. Critics warn that conflicts of interest could limit accountability and put Tesla shareholders at risk.
“The challenge is transparency,” said analyst Samantha Wu of Global EV Research. “Shareholders want to know whether Tesla’s money would be used for Tesla’s benefit, not just to support Musk’s other projects.”
Tesla has not disclosed the size of the possible investment in xAI, but analysts expect it could be significant. Musk has promoted xAI as a competitor to OpenAI and Google DeepMind, aiming to build safer and more human-aligned artificial intelligence systems.
The outcome of the votes will send a strong signal about investor confidence in Musk’s leadership. A rejection of the pay package would mark a rare pushback against one of the most influential executives in the world. Approval would cement Musk’s role at Tesla for years to come, while giving him potentially unprecedented personal wealth.
The November meeting is expected to draw widespread attention from Wall Street, technology analysts and Tesla’s large base of retail investors. Many are watching to see how the balance between Musk’s influence and shareholder oversight will play out.
Tesla said results of the vote will be announced shortly after the annual meeting.
For now, shareholders large and small are weighing the future of the world’s most valuable electric car company — and the billionaire who leads it.
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