Tesla CEO Elon Musk has been awarded a $29 billion compensation package by the company’s board, reigniting debate over executive pay as legal and shareholder scrutiny continues.
The package stems from Musk’s disputed 2018 performance award, which was struck down earlier this year by a Delaware court following a shareholder lawsuit. Tesla is currently appealing the ruling, and Musk has yet to receive the payout.
In a letter to shareholders on Monday, August 4, Tesla’s board reaffirmed its support for the package, stating Musk has “not received meaningful compensation for eight years.” The board also emphasized that legal efforts are underway to reinstate the 2018 deal, though “there’s no clear timeline for resolution.”
Under the terms of the award, Musk would be entitled to purchase 96 million Tesla shares—now trading above $300—at a fixed price of $23.34 per share, the same as in the original agreement.
Board members Robyn Denholm and Kathleen Wilson-Thompson defended the compensation, praising Musk’s role in Tesla’s growth. “Despite these legal challenges, we can all agree that Elon has delivered the transformative and unprecedented growth required to earn all milestones of the 2018 CEO Performance Award,” they stated.
Musk, who doesn’t draw a salary or bonus from Tesla, depends on stock option packages for income. He currently owns around 13% of Tesla’s shares, making him the company’s largest individual shareholder.
However, Musk’s political activity has drawn criticism. His vocal support for Republican candidates has sparked protests at Tesla locations and has been linked to a dip in vehicle sales.
At the same time, Tesla has faced headwinds from recent U.S. policy changes under former President Donald Trump, including the rollback of tax incentives and regulatory credits for electric vehicles—once a vital revenue stream for the company.
Tesla stock is down 25% so far in 2025, though shares rose nearly 3% in premarket trading following the pay package announcement.
In response to mounting shareholder pressure, Musk has pledged to refocus his attention on Tesla. The compensation package is widely seen as a move to retain his leadership as the company navigates economic pressures and strategic shifts.
Tesla is increasingly expanding beyond electric vehicles, with a growing emphasis on artificial intelligence and robotics. “Through Elon’s unique vision and leadership, Tesla is transitioning from a leader in the electric vehicle and renewable energy industries to becoming a leader in AI, robotics, and related services,” the board said.
A key project in this new direction is Tesla’s long-awaited robotaxi initiative, which, though scaled back, has entered its early rollout phase.
