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Tesla Shareholders Reapprove Elon Musk’s $46 Billion Compensation Package
After a Delaware judge previously struck down Tesla CEO Elon Musk’s $46 billion compensation package, investors have now put it back on the table. The annual meeting of shareholders took place in Texas, where the company is headquartered, opening up Tesla to operational changes and serving as a referendum on Musk’s leadership since 2008.
Tesla investors have reapproved Musk’s 2018 pay package, allowing him to purchase 304 million shares at a little over $23 each. While the exact percentage of approval is undisclosed, Musk hinted at around 70% in a graph shared the night before the vote.
There were differing opinions among institutional investors regarding Musk’s compensation. Major shareholders Norges Bank Investment Management and CalPERS publicly opposed it, while Ron Baron and Scottish Mortgage Investment Trust pledged their support. Vanguard, State Street, and BlackRock did not disclose their stance before the meeting.
It’s worth noting that the approval of Musk’s compensation is more symbolic than legally binding. Tesla is expected to use it as leverage in a potential appeal of the previous ruling by the Delaware judge, pending the resolution of legal fees from the January case.
During the shareholder meeting, Musk unveiled his vision for a future self-driving fleet of Teslas, comparing it to a blend of Airbnb and Uber. Owners could opt their cars into the service, potentially allowing them to earn money while their vehicles are not in use. Musk expressed confidence that this venture could significantly increase the value for both Tesla and its customers.
Tesla’s Future Projects and Developments
Musk also discussed the potential of Tesla’s Optimus robots, estimating that they could add $20 trillion to the company’s market capitalization. These robots are anticipated to enter limited production next year and might be sold for $20,000 to $30,000 each.
Furthermore, Musk announced that the Tesla Semi electric truck has received approval for volume production ahead of schedule. The truck has already been ordered by companies like PepsiCo, Costco, and Walmart. In addition to the vote on Musk’s compensation, shareholders addressed 11 other ballot measures, including the reincorporation of Tesla in Texas and the reappointment of board members.
Following the meeting, Tesla stock experienced a nearly 3% increase during regular trading hours and a 1% gain in after-market trading.
Key Proposals Voted by Tesla Shareholders
- Reelection of Board Members: Kimbal Musk and James Murdoch were both reelected for three-year terms.
- Executive Compensation Approval: Shareholders approved the compensation for executives like Tom Zhu and Vaibhav Taneja.
- Texas Reincorporation: Shareholders agreed to potentially reincorporate Tesla in Texas.
- Public Accounting Firm: PricewaterhouseCoopers was approved as Tesla’s public accounting firm for the upcoming fiscal year.
Shareholders also voted on proposals from investors, with some advocating for greater accountability and sustainability measures within Tesla’s operations.
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