Elon Musk’s potential $1 trillion Tesla payday comes with a huge asterisk

Elon Musk stands to become the world’s first trillionaire if he fully earns a new pay package at Tesla — which comes with an astronomical series of goals for increasing the company’s market value.

Why it matters: Achieving those goals would make Tesla the most valuable company in history, and Musk, already the world’s richest person, massively wealthier still.

Driving the news: Tesla filed a preliminary proxy statement with securities regulators on Friday morning, laying out a “2025 CEO Performance Award” that it wants shareholders to approve.

By the numbers: The award lays out a series of milestones to hit, essentially steps to unlock the full compensation package for Musk.

At the highest end, if he takes Tesla’s market capitalization by 2035 to $8.5 trillion — roughly 8 times where it is today, and about double the world’s current most valuable company, Nvidia — he could unlock the full award.
Tesla said the fair-market value of the award was $87.75 billion and would let Musk acquire up to 12% of Tesla’s outstanding stock.
If the company’s market cap grows eightfold, that would make him the founder of the trillion-dollar club.
In trading before the market open, shares of Tesla were up 2%.

Tesla Chairman Robyn Denholm emphasized: “Retaining and motivating Elon Musk is vital if Tesla wants to become the most valuable company in history.”

Elon Musk – the richest person on the planet – is facing the opportunity to become the first trillion-dollar billionaire in history, thanks to a huge stock bonus package that Tesla’s board of directors has just presented to shareholders. However, behind that shocking number is a risky bet for the future of this electric car company.

Unprecedented

According to financial records released over the weekend, Elon Musk could receive 423.7 million Tesla shares – equivalent to about $1 trillion if the company reaches “huge” growth milestones in the next 10 years.

The biggest goal: to bring Tesla’s capitalization to $8.5 trillion, nearly 8 times the current level. If completed, Musk’s stake in Tesla will increase from about 13% to 29%, consolidating voting rights and leadership.

In addition to the capitalization requirement, Musk must achieve a series of ambitious goals such as delivering 20 million vehicles/year, deploying 1 million robots and 1 million commercial robotaxis, reaching 10 million subscribers to Full Self Driving, increasing adjusted EBITDA to 400 billion USD, more than 20 times the level in 2024.

However, another factor that makes Tesla spend heavily is trying to hold on and keep Elon Musk around.

Tesla Chairman Robyn Denholm emphasized: “Retaining and motivating Elon Musk is vital if Tesla wants to become the most valuable company in history.”

With the board, Elon Musk is not only the CEO but also the “biggest asset” – who is capable of leading Tesla in the race of AI, robots and self-driving cars. The world’s richest billionaire once said he needed at least 25% of the voting power to steer the strategy, otherwise he would “build products outside of Tesla”.

However, this bonus package is deeply divisive. Some analysts warn that the $8.5 trillion target is unrealistic in the context that Tesla faces many challenges.

Its sales and profits have plummeted by 71% in the first quarter of 2025 and 16% in the second quarter. The main reason is fierce competition from Chinese electric car companies such as BYD, and the loss of revenue from the sale of emission credits due to changes in US law.

In addition, the company is also being negatively affected by Elon Musk’s statements and political activities.

Besides, Musk has a history of promising fully self-driving cars since 2014 but has not been realized, leading critics to worry that Tesla is pursuing more scenarios than practical solutions.

Critics also argue that the bonus package will make Musk focus on inflating the stock price rather than solving the company’s core problems.

Moreover, many of Musk’s promises of self-driving technology have not come true in the past, leading some experts to call him a “master of market manipulation”.

“Elon Musk has said since 2014 that we will have a fully autonomous car next year. That hasn’t happened yet but that promise has been appreciated by Wall Street for billions of dollars,” said analyst Gordon Johnson, one of Tesla’s harshest critics. “Elon Musk is a master of manipulation. He kept the stock high. “The reason the board paid him was because he was willing to say things that other CEOs wouldn’t dare to say or couldn’t get away with.”

Gambling

Returning to the reward package, the dossier submitted to shareholders also includes a proposal for Tesla to invest in xAI – Musk’s artificial intelligence company, after SpaceX has poured $2 billion into it. This move can help Musk strengthen his business empire that spans from electric vehicles, space, social networks to AI.

Tesla shareholders will vote on the bonus package and propose to invest in xAI on November 6. The results not only determine Musk’s financial future, but also shape the direction of Tesla in the next decade.

For fans, this is a worthy reward for a strategist who has turned Tesla into the world’s No. 1 electric car company. But for the skeptic, it is a testament to the recklessness – even the risk – of a company that is willing to bet on an individual, despite the risks.

Despite the conflicting opinions, Tesla still affirmed its absolute faith in its CEO, saying that only Musk can lead the company to achieve “a long-term mission at an unprecedented level”. The upcoming shareholder vote will decide whether Musk will receive this dream compensation package, and whether history will record him as the world’s first trillion-dollar billionaire.