Elon Musk, already the world’s richest person, has just been granted a staggering $29 billion pay package by Tesla’s board—even as controversy swirls around his previous, court-blocked compensation deals.What’s in the Package?The new interim package awards Musk 96 million shares of restricted stock, valued at just over $300 apiece. Musk must pay $23.34 per share—identical to his 2018 award’s strike price. The deal requires Musk to remain CEO or in a senior executive role at Tesla for two more years and to hold the stock until 2030 to fully vest the award.Why Now?Tesla’s generous move comes after a Delaware judge twice tossed out Musk’s landmark 2018 pay plan—designed in “sham negotiations” with an arguably too-friendly board—leaving his compensation in legal limbo. Shareholders later voted to re-approve Musk’s pay, but a final legal ruling could still overturn either plan, and the new package contains a “no double dipping” clause to avoid Musk collecting both awards.Motivation Amid a Challenging YearTesla’s share price is down over 18% this year, and the company has seen slowing sales, shrinking profits, and increased competition—while Musk’s political activism has put off some eco-conscious customers, especially in California. With so many of his energies devoted to other projects (like xAI and SpaceX), and investor concern mounting, the board says the package is needed to “retain and motivate” Musk as Tesla pivots toward AI, autonomous vehicles, and robotics—a critical crossroads for the automaker.How Does It Stack Up?This is, by far, the largest executive compensation plan in history—beating even Musk’s own invalidated $55 billion package from 2018. For context, the next biggest were Stephen Schwarzman’s $1.39 billion (Blackstone, 2008) and Alexander Karp’s $1.10 billion (Palantir, 2020).Key Terms:Award: 96 million new restricted sharesEligibility: Stay in executive role for two years, hold shares until 2030Strike Price: $23.34/share (Tesla’s current price is over $300)Legal clause: If the 2018 plan is ultimately reinstated, the new $29 billion award will be tossed to prevent double compensation.Why It MattersTesla’s board is betting that keeping Musk is essential to the company’s future, especially as it races to dominate AI, robotaxis, and next-generation robotics. But with brand challenges, shareholder dissent, and ongoing legal battles, the world will be watching to see whether this record-setting pay package delivers the motivation—and leadership—Tesla needs now.
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