Tesla board approves $30 billion stock award for Elon Musk amid leadership uncertainty

Elon Musk Tesla pay package 2025: Tesla’s board has approved a massive $30 billion stock grant for CEO Elon Musk, a move aimed at securing his future at the company amid growing concerns over his commitment and control, as per a report.

Elon Musk's New Pay Package Includes 96 Million Shares

The stock grant, as part of a new pay deal, consisting of 96 million shares, was recommended by a special committee made up of board chair Robyn Denholm and director Kathleen Wilson-Thompson, and later approved by the full board, according to a filing on Monday, as reported by the Financial Times.

Tesla Says Retaining Elon Musk is "More Important Than Ever"

The EV maker said in a letter to shareholders on Monday that, “Retaining Elon is more important than ever before,” as quoted in the report. The firm added, “We are confident that this award will incentivise Elon to remain at Tesla,” as quoted in the report.


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Tesla Faces Ongoing Legal Battle Over CEO Compensation

The decision comes during a tense time for both Tesla and Musk. The company has been locked in a years-long legal battle over Musk’s original $56 billion compensation package, which is the largest in US corporate history, as per the Financial Times report. That deal, approved in 2018, was struck down by a Delaware court in January 2024 after Judge Kathaleen McCormick ruled it was excessive and criticized the board’s lack of independence in negotiating with Musk, as reported by the Financial Times.

Elon Musk Has Repeatedly Threatened to Leave Tesla

Since then, Musk has made several public statements suggesting he might walk away from Tesla if he wasn’t given more influence or ownership of the EV maker, according to the report. After Tesla reported weaker-than-expected results last month, he again warned that activist shareholders could potentially push him out, saying, “I think my control over Tesla should be enough to ensure that it goes in a good direction, but not so much control that I can’t be thrown out if I go crazy,” as quoted in the Financial Times report.

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What Musk’s New Stock Package Means for Tesla Investors

If the disputed pay package is reinstated by Delaware’s Supreme Court on appeal, Musk’s stake in Tesla would rise from just under 13% to over 20%, giving him significantly more leverage over the company, according to the report.

The Tesla CEO must pay the EV giant $23.34 per share of restricted stock that vests, which the firm said was equal to the exercise price per share of the 2018 pay award, as reported by the Financial Times.

FAQs

Why did Tesla approve a new stock award for Elon Musk?
To ensure Musk stays committed to leading Tesla, especially after legal challenges and public threats to leave, as per the Financial Times report.

Why is Elon Musk asking for more control over Tesla?
Musk claims that more control ensures strategic stability and protects Tesla from activist investors, as per the Financial Times report.