Tesla Shareholders Approve $1 Trillion Compensation Plan for Elon Musk

In Focus

• Tesla shareholders approved Elon Musk’s $1 trillion pay package
• About 75% of shareholders voted to support the package
• Musk announced Tesla may produce AI chips

Tesla shareholders approved CEO Elon Musk’s compensation package during the annual meeting in Austin, Texas. According to Yahoo Finance, Tesla’s 1 trillion-dollar package received about 75% approval from shareholders.

Approval Causes Tesla Stock to Surge

Tesla shareholders’ approval of Musk’s compensation plan pushed EV maker’s stock up about 2%. The company’s board proposed the $1 trillion dollar pay package for Musk in early September 2025.

Tesla’s milestone-based pay for Musk offers him 12 large tranches of stock options linked to aggressive performance targets.

“I’d like to give a heartfelt thanks to everyone who supported the shareholder votes. I super appreciate it,” Musk said.

A majority of shareholders approved the proposal to invest in Musk’s AI startup xAI though a significant number of them abstained from voting. The Tesla board will review the proposal further. Shareholders also voted to retain three directors who were due for re-election.

Musk’s Voting Power Expanded

Musk had expressed discomfort leading the EV maker with less than 20% share of voting power, which the new compensation package now offers.

Last month, Tesla’s board chair urged investors to approve his trillion-dollar pay package, saying that he could leave the company if they failed to do so. The Tesla CEO held a 13% stake in the company prior to the latest pay plan. The new $1 trillion package extends the stake to 28.8%.

For some institutional investors, this is a major concern. Norway’s wealth fund, which holds a 1.2% stake in the EV maker, voted against the Tesla CEO compensation package.

The fund highlighted the “total size of the award, dilution, and lack of mitigation of key person risk” as critical issues that needed to be addressed.

Tesla’s Trillion-Dollar Pay Package at a Glance

• The package offers Musk 12 tranches of stock options
• The $1 trillion package extends Musk’s stake to 28.8%
• Musk hinted at working with Intel on the Tesla AI chip project

Tesla’s Future Manufacturing Plans

Musk outlined Tesla’s potential manufacturing plans at the annual shareholders meeting. The CEO said that the EV maker will likely establish a gigantic chip fabrication facility to manufacture AI chips. Musk hinted at working with Intel on the Tesla AI chip project.

“You know, maybe we’ll do something with Intel. We haven’t signed any deal, but it’s probably worth having discussions with Intel,” Musk said.

Musk announced the establishment of a 1 million-unit Optimus production line in the Fremont factory in California. Eventually, Tesla plans to build a 10 million-unit production facility in Austin, Texas.

Tesla will start producing Cybercab robotaxi in April 2026 with plans to expand autonomous taxi service to Phoenix, Miami, Las Vegas, and Dallas. The EV maker will unveil the Tesla Roadster on April 1, 2026, production is expected 12 to 18 months after the launch.