Elon Musk, the head of Tesla, has given a warning to investors that is quite outspoken, the head of Tesla may quit the company unless they agree to grant him his proposed package of executive compensation worth one trillion dollars.
The affirmative has left an impact in the business community, as it casts uncertainty on the stability of leadership and Tesla as a future company.
To Musk, the huge remuneration package does not only deal with cash but also with power and dedication.
According to him, the arrangement would grant him sufficient control to remain at and lead Tesla in the most aspiring ventures, including AI-controlled free driving, robotics, and energy innovations.
Unless this is established and confirmed, Musk hinted he might redirect his attention to other businesses like SpaceX, xAI, or Neuralink, where he already has major leadership stakes.
The demand that Musk puts forward comes at a time when Tesla is experiencing various challenges.
The electric vehicle (EV) market is attracting more competition, and such companies as BYD, Rivian, and Lucid Motors are increasing their popularity.
Moreover, the latest quarterly sales of EVs in the world have declined, which has exposed Tesla’s growth ambitions.
Such a trillion dollar compensation plan may be seen as a lot of money, and critics claim that the company could implement this plan at the worst time, as the company should invest in innovation and market expansion.
Nevertheless, Musk and his followers communicate that his pure leadership would be a key to the long term success of Tesla.
Throughout the years, Musk has developed Tesla, which has evolved into an EV giant in the world, with breakthrough approaches to battery technology, solar energy, and artificial intelligence driving technologies.
His admirers believe his vision has been the success behind Tesla, and losing him will cause confusion among the investors and workforce.
The plan offered would provide Musk with a huge stock related payout, which is subject to Tesla reaching certain valuation and performance targets.
This is similar to his 2018 compensation package, which was among the biggest ever in company history and built Tesla market value over 1 trillion in 2021.
Musk believes that the new plan would make him strive to bring Tesla to even greater heights, such as new innovations in AI, energy storage, and humanoid robotics.
Yet, not everyone agrees. The demand has been perceived as a concentration of power that is unfair to some shareholders and corporate governance specialists.
They point out that Musk already has significant control, and collectivity of leadership, rather than individual leadership, should have made Tesla successful.
People also fear that this kind of arrangement may give the wrong message at a time when the public companies are being encouraged to exercise financial responsibility and transparency.
The controversial aspect notwithstanding, Musk is not intimidated.
In more recent posts, he said that the deal would not be successful, he might devote more time to other businesses, which implies that he can focus on other businesses in his expanding enterprise.
That alone was enough to cause the stock of Tesla to go a bit volatile as the investors speculated on what a Tesla without Elon Musk in charge would look like.
With the ongoing conversations, the Tesla board and shareholders are in a difficult position, either to take up the offer of Musk of the trillion dollars or to lose one of the most powerful players on the modern technology scene.
In any case, the result of it is likely to define Tesla in a number of years ahead.
