Tesla has granted its chief executive, Elon Musk, a jaw-dropping $29 billion (£21.7 billion) worth of shares. This move is an early and shrewd step to keep him as demands on his time and attention increase dramatically. This large share allocation from the ARP comes at an important moment. It comes on the heels of Musk’s announcement that he plans to distance himself from political activities, in which he counseled former President Donald Trump.
The share award is intended to provide a strong, long-term incentive for Musk to stay with Tesla. It has the additional effect of increasing his voting power on the company’s board. As Tesla faces an increasingly competitive landscape for artificial intelligence talent, the board believes that retaining Musk is vital for the company’s continued success.
“It is imperative to retain and motivate our extraordinary talent, beginning with Elon,” stated a representative from Tesla’s board. In that same sense, the board appreciates Musk’s distinctive blend of leadership experience and technical know-how. They think no one else in the industry would be able to do what he can do.
This share award couldn’t come at a more critical time. A US court recently determined Musk’s 2018 pay package, worth more than $50 billion, was “unjust to shareholders.” The court’s ruling has triggered new scrutiny over executive pay and the need for executive compensation to be tied to shareholder benefit. Tesla remains positive about the new share award. They think it will incentivize Musk to keep doing what’s working to keep him at the helm of the company.
Musk’s line of responsibility extends well beyond Tesla’s doors. He serves as executive chairman of xAI, Neuralink, and The Boring Company. The latter emphasizes building new mixed-use tunnels and other alternative-mobe-related infrastructure projects nationwide. As the complexity of these roles deepens, the temptation of a big share grant looms larger. Perhaps this grant will be what finally helps keep him rooted to the ground at Tesla.
Tesla’s board further emphasized the necessity of this move, stating that “no one matches Elon’s remarkable combination of leadership experience, technical expertise.” Musk’s creative ability exemplifies Tesla’s commitment to thinking outside of the box. This new commitment further cements their leadership in the global race to dominate the electric vehicle market.