Ahead of Tesla’s annual general meeting on Thursday, the company is pushing one clear message to investors: Elon Musk deserves $1 trillion. The electric carmaker has launched online ads and videos defending its CEO’s massive pay deal. On Votetesla.com, board chair Robyn Denholm and director Kathleen Wilson-Thompson praise Musk while triumphant music swells in the background. But many shareholders are not convinced. The meeting in Austin, Texas, is shaping up as a public vote on Musk’s leadership, which has become increasingly polarising after his political shifts and blunt online presence. Musk has used his platform X to heighten the tension, saying Tesla’s fate “could affect the future of civilization.” He has also amplified messages of support from powerful allies, including Dell founder Michael Dell, Ark Invest CEO Cathie Wood, and his brother Kimbal, who sits on Tesla’s board. “There is no one remotely close to my brother,” Kimbal said. “Thanks bro ❤️,” Musk replied.
Doubts among investors
Some investors say the focus on Musk’s pay shows how Tesla has drifted from its core mission while car sales decline. “What’s amazing to me is a company struggling to sell cars spends money on advertising to sell a pay package,” said Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management. He has reduced his Tesla shares and criticised the firm’s direction. “Tesla needs to return to what it does best – selling electric vehicles,” he said.
The trillion dollar challenge
The proposed plan is not a $1tn salary. Instead, it gives Musk the goal of raising Tesla’s market value from $1.4tn to $8.5tn. He must also lead a breakthrough for self-driving “Robotaxi” cars, bringing one million into commercial use. That would mark a major turnaround after their slow start. If Musk succeeds, he would receive 423.7 million new shares, worth about $1tn at the target valuation. Tesla has not commented on its campaign to gain shareholder support.
It’s not the first time Tesla has faced controversy over Musk’s pay. Shareholders previously approved a huge package worth tens of billions if he grew Tesla’s value tenfold. He achieved that target, but a Delaware judge overturned the deal in 2024, ruling that Tesla’s board was too close to him. The Delaware Supreme Court is now reviewing that decision while the company seeks approval for this even bigger plan.
“The approach is familiar for Tesla, though nothing about Tesla is ever ordinary,” said Columbia Law School professor Dorothy Lund in an interview. “They’re not an example of good corporate governance.” She added that such campaigns usually happen when companies fear activist investors, not during pay negotiations. “I’ve never seen anything like this for a compensation decision,” she said.
Both Elon and Kimbal Musk will vote this time, hoping to secure the majority needed to pass the deal. Musk, already the world’s richest person, became the first half-trillionaire earlier this year.
A board under fire
Tesla argues it cannot afford to lose Musk. The company insists he “uniquely possesses the leadership necessary to achieve its long-term goals.” In a video on Votetesla.com, Wilson-Thompson said the board spent seven months with experts designing the package. During Tesla’s last earnings call, Musk downplayed the payout, saying he simply needed enough control to steer the company effectively.
Critics disagree. “The board should protect shareholders, not campaign for the CEO,” said Yale professor Matthew Kotchen, who co-authored a study on Musk’s recent impact on Tesla’s brand.
Several major institutions also oppose the deal. Proxy advisers Glass Lewis and Institutional Shareholder Services have told investors to vote against it, calling it excessive and damaging to shareholder interests. Norway’s sovereign wealth fund, the world’s largest, plans to do the same, along with CalPERS, America’s biggest public pension fund. New York State Comptroller Thomas DiNapoli has urged investors to reject Tesla directors up for re-election, accusing them of failing to provide “independent oversight and accountability.”
A decisive moment for Tesla’s future
As major funds push back, Musk may rely on Tesla’s vast number of small retail investors, who often support him. Morgan Stanley analyst Adam Jonas described Thursday’s vote as one of “the most important events” in Tesla’s history, warning there’s a “real possibility” the pay deal could fail.
Musk’s image has also taken a hit after his brief and controversial stint in Donald Trump’s administration earlier this year. “It’s hard to imagine Musk quickly repairing the damage to this brand,” said Kotchen.
Still, some believe his record makes him too important to doubt. “Elon Musk’s larger-than-life persona has brought more attention to Tesla than almost any other corporate leader,” said Jessica Caldwell, head of insights at Edmunds. “He’s more divisive now, but many still believe he can turn bold visions into reality,” she added.
The question that now defines Tesla’s future is simple: will its shareholders bet $1 trillion on Elon Musk?
