According to Reuters, Tesla has just approved a “temporary bonus” worth 96 million shares for Elon Musk.
This is considered a “goodwill” payment to make up for a $50 billion compensation package approved in 2018 but later rejected by the courts.
With an estimated value of $29 billion, the number of shares Elon Musk will receive even surpasses the market capitalization of Mercedes-Benz ($28.5 billion, according to Forbes).
The Tesla CEO will be able to purchase these shares at $23.34 per share, equivalent to the exercise price of the 2018 bonus, and must hold them for at least five years. Currently, Tesla’s shares are trading at over $339 per share.
The new bonus increases Elon Musk‘s ownership stake in Tesla from 12.7% to over 15%, solidifying his control. Previously, Tesla stated that Musk had not received any significant compensation since 2017. The board emphasized the need to retain this “extraordinary talent” amid the ongoing legal dispute over the 2018 package.
Tesla plans to vote on long-term compensation for the CEO at its annual shareholder meeting on November 6. The board noted that this move aims to keep Musk focused on the company’s new strategy, particularly in the robotaxi and robot sectors, as the traditional automotive business faces challenges.
The granting of this large bonus to Musk also dispels speculation that the board was losing patience with him after a tumultuous few months, including political activities. The directors affirmed that Elon Musk remains the best person to lead Tesla through intense competition and declining sales.
Data from S&P Global Mobility indicates that customer loyalty to Tesla has significantly dropped since Musk publicly endorsed former US President Donald Trump last summer. Additionally, Musk’s involvement in other projects, such as the AI startup xAI, has raised concerns about his level of dedication to Tesla.
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“Trump Parts Ways With Tesla: Former President Sells His Model S Amidst Musk Feud”
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Recent rumors suggest that former US President Donald Trump is considering selling or giving away his cherry-red Tesla Model S, purchased earlier in March this year.
