Tesla approves $29 billion in shares to Elon Musk
The electric vehicle maker said in a statement it will award a distribution of 96 million Tesla shares to Musk as it 'intends to compensate its CEO for his future services commensurate with his contributions to our company and shareholders.'
The award comes as Tesla challenges a Delaware court ruling that struck down a 2018 package of about $55.8 billion.
With that appeal dragging out, Monday's announcement marks an interim step while the company develops a 'longer-term CEO compensation strategy,' Tesla said in a letter to shareholders.
'We have recommended this award as a first step, 'good faith' payment,' said the letter.
'Retaining Elon is more important than ever before.'
The move comes amid a fierce battle for top engineering talent as companies like Google and Meta compete for leadership on artificial intelligence.
The Tesla letter, signed by Tesla board members Robyn Denholm and Kathleen Wilson-Thompson, described Musk as a 'magnet for hiring and retaining talent at Tesla,' noting that Tesla is transitioning from its electric vehicle focus 'to grow towards becoming a leader in AI, robotics and related services.'
Musk is viewed within the business world as a unique talent after his success with building Tesla and SpaceX into major global companies.
But his stewardship at Tesla has come under scrutiny in the last year as car sales and profits have tumbled.
This trend has been partly due to Musk's support for far-right political causes, but also is related to a sluggish rollout of new auto models after the polarizing Cybertruck sold poorly.
In a July 23 Tesla earnings call, Musk warned of more potentially 'rough' quarters ahead before the company's robotics and AI ventures pay off.
On the call, Musk reiterated his concern about the current framework in which he holds about 13 percent of Tesla shares prior to Monday's award.
'As I've mentioned before, I think my control over Tesla should be enough to ensure that it goes in a good direction, but not so much control that I can't be thrown out if I go crazy,' Musk said.
Tesla's statement did not explicitly mention Musk's foray into politics, which has sparked consumer boycotts and vandalism. But the letter by Denholm and Wilson-Thompson alluded to concerns that Musk's attention had drifted from the company, calling the interim package a step towards 'keeping Elon's energies focused on Tesla.'
The massive pay package comes eight months after the judge in a Delaware court rejected Musk's even larger compensation at Tesla, denying an attempt to restore the pay deal through a shareholder vote.
Musk would be required to forfeit the new compensation package should the appeals court rule in his favor and grant him the full 2018 compensation, which at the time was valued at $55.8 billion.
The new payout is sure to fuel concerns about the compensation for Musk, already the world's richest man, and whether the Tesla board is placing a sufficient check on the company's chief executive.
Tesla shares rose 2.4 percent on Monday in early trading.
Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1
Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
By Garrin Lambley © Agence France-Presse
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Citizen
4 hours ago
- The Citizen
Google donates $1m to University of Pretoria to help AI research
Google coughs up millions to back university's AI innovation The University of Pretoria has received a donation of $1 million (R17.7 million) from Google to support the African Institute of Data Science and Artificial Intelligence (AfriDSAI). R18 million donation AfriDSAI is an institute at the University of Pretoria that brings researchers, technologists and communities together to reimagine how data science and AI can work for Africa. The research institute is led by Professor Vukosi Marivate. He is the ABSA Chair of Data Science and a Professor in the Department of Computer Science. 'This gift significantly enhances AfriDSAI's ability to conduct high-impact, socially responsive research and grow a new generation of African data scientists and AI leaders,' said Prof Marivate. The funding is set to mark a major step forward in Africa's drive to become a significant contributor to the global AI research landscape. Marivate further said, 'It strengthens our mission to build sustainable AI research communities across Africa and ensure that AI technologies developed here are shaped by local knowledge and values. As Africa currently contributes only 0.9% of global AI research output, this kind of investment is vital in changing that narrative.' ALSO READ: Google creating new opportunities with AI in Action UP pushes AI innovation The Vice-Chancellor of the University of Pretoria, Prof Francis Petersen stated, 'The University of Pretoria is committed to being a thought leader in knowledge generation that is relevant, inclusive, and solutions-oriented.' Petersen said AfriDSAI aims to position Africa as a global contributor, and not just a beneficiary, of AI. He said the donation will leverage transdisciplinary research and innovation in addressing pressing societal issues. 'This generous support from Google aligns with our strategy to advance research with impact and reinforce Africa's position in the global AI ecosystem. AfriDSAI is a flagship example of how we aim to drive innovation with real-world impact, 'said Prof Petersen.
The Herald
4 hours ago
- The Herald
Corvette C8 Stingray goes on sale in SA: this is how much it costs
Available in both coupé and convertible body styles, the Stingray features a driver-focused cockpit equipped with a customisable digital instrument cluster, a 12.7-inch touchscreen infotainment system, wireless charging, 10-speaker Bose premium sound system and eight-way power-adjustable GT1 seats trimmed in Mulan leather. A reverse camera is also standard. Sold with a service plan and warranty, pricing for the Corvette Stingray starts at R3,700,000. For those seeking even more performance, CVH Auto Group has confirmed the 500kW Corvette Z06 will be introduced later.
The Herald
5 hours ago
- The Herald
Soweto Marathon shifts to late November under new organisation
The 30th edition of the Soweto Marathon is shifting to late November, a spokesperson for the event said on Thursday, contradicting claims by Soweto Marathon Trust (SMT) representatives that the country's biggest one-day road race had been cancelled. Jabu Mbuli said nine of 11 Soweto running clubs had agreed to administer the race through an NPO. This came after allegations against the previous two bodies that staged the race — the SMT and then a private company that stepped in to organise the past two races in 2023 and 2024. 'We believe this [NPO] option will assist in ensuring good and proper governance and sound financial accountability,' Mbuli said. 'The appointed non-executive board of directors will comprise largely of qualified professionals and will include chartered accountants and attorneys. The athletics clubs of Soweto own this race and they will focus on the race organising committee to run this race by the people, for the people.' SMT representatives recently claimed there would be no race this year, but Mbuli said the 2025 race would be launched this month and would take place at the end of November.
