The world’s richest man has just been given the opportunity to become the first trillionaire in history.
Elon Musk secured a shareholder vote yesterday granting the Tesla CEO a potential payout valued at $1 trillion (€865 billion) if he achieves a set of performance targets over the next decade, reports RTE.
The vote followed weeks of intense debate over his leadership at the electric vehicle company and whether any individual merited such an extraordinary compensation package, sparking commentary from small investors, major pension funds, and even the pope.
In the end, more than 75% of shareholders voted in favour of the plan during Tesla’s annual meeting in Austin, Texas, reports RTE.
“Fantastic group of shareholders,” Mr Musk said after the results were confirmed, adding, “Hang on to your Tesla stock.”
The outcome marks a decisive victory for Mr Musk, signalling continued investor confidence despite Tesla’s steep declines in sales, profits, and market share — challenges driven in part by Musk’s own controversies, reports RTE.
Car buyers have turned away from Tesla this year as Musk’s political comments and engagement with conspiracy theories have stirred public backlash.
The vote also came just three days after new data from Europe revealed Tesla’s car sales dropped sharply again last month, including a 50% fall in Germany, reports RTE.
Nonetheless, many Tesla investors still regard Musk as a visionary capable of extraordinary business turnarounds, recalling how he led the company from near-bankruptcy six years ago to become one of the world’s most valuable corporations.
The approval clears a potential path for Musk to reach trillionaire status by awarding him new Tesla shares, though doing so will require meeting a series of demanding performance goals, reports RTE.
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The board’s conditions require Musk to boost Tesla’s market valuation to nearly six times its current level, alongside other operational milestones.
He must also deliver 20 million electric vehicles globally within the next decade — more than double the total produced since the company’s founding — and deploy one million of his promised humanoid “robot army,” starting from zero today, reports RTE.
Musk could amass billions in additional wealth by partially achieving these targets, as each milestone unlocks new stock awards that bring him closer to the trillion-dollar mark.
That trajectory could eventually see him surpass John D. Rockefeller, who Guinness World Records estimates was worth $630 billion in today’s dollars at his wealthiest point more than a century ago, reports RTE.
Musk’s current fortune is estimated at $493 billion, according to Forbes magazine.
His compensation plan passed despite opposition from major institutional investors including CalPERS — the largest U.S. public pension fund — and Norway’s sovereign wealth fund, reports RTE.
Corporate governance advisory firms Institutional Shareholder Services and Glass Lewis also condemned the proposal, prompting Musk to label them “corporate terrorists” during a recent investor meeting.
Critics argued that Tesla’s board is overly loyal to Musk, citing his unpredictable behaviour and the excessive scale of the reward.
“He has hundreds of billions of dollars already in the company and to say that he won’t stay without a trillion is ridiculous,” said Sam Abuelsamid, an analyst with Telemetry Research who has followed Tesla for nearly 20 years, reports RTE.
“It’s absurd that shareholders think he is worth this much.”
Supporters countered that Musk must be incentivised to stay focused on Tesla as he aims to transform it into an AI-driven powerhouse — developing self-driving cars, many without steering wheels, and humanoid robots for industrial and domestic use, reports RTE.
“This AI chapter needs one person to lead it and that’s Musk,” said Dan Ives, a financial analyst at Wedbush Securities. “It’s a huge win for shareholders,” reports RTE.
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