Tesla has awarded its CEO Elon Musk a staggering $29 billion in company shares, aiming to secure his continued leadership amid growing competition in artificial intelligence (AI) and robotics. The move comes after a Delaware court invalidated Musk’s previous 2018 pay package worth over $50 billion declaring it “unfair to shareholders.”
Musk is currently appealing the court’s decision, arguing that legal errors were made and that it should be up to Tesla shareholders to decide executive compensation. Tesla’s board, however, is taking proactive steps to ensure Musk remains fully committed to the company during a critical transition phase.
In a statement shared on X, the social media platform Musk owns, Tesla’s board described him as an irreplaceable asset with unmatched technical expertise and leadership. “It is imperative to retain and motivate our extraordinary talent, beginning with Elon,” the statement read.
Tesla said that if the Delaware court reinstates the original 2018 package, Musk would forfeit or return the new $29 billion award to prevent what it called a “double dip.” Notably, Musk had already met all the milestones of the original deal, including goals related to Tesla’s market value, revenue, and profits.
Industry analysts say the new share award is essential to keeping Musk focused on Tesla, particularly as tech firms intensify their race for AI dominance. “The biggest asset for Tesla is Musk,” said Dan Ives of Wedbush Securities. “They need to do this to keep him committed.”
The carmaker emphasized that it is at an “inflection point,” transitioning from a pure electric vehicle company to one focused on AI and robotics. With major players like Meta and Microsoft aggressively recruiting top AI talent, Tesla sees Musk’s involvement as key to remaining competitive.
The new award is also seen as a counterbalance to Musk’s growing commitments elsewhere, including executive roles at xAI, Neuralink, and The Boring Company. Despite his broad portfolio, Tesla hopes the multi-billion-dollar incentive will ensure Musk stays at the helm as the company navigates its next chapter.
