Tesla’s $1 Trillion Musk Plan: AI, Robotaxis and the Future of Tech

Tesla has announced what might be the boldest compensation plan ever in the history of corporate compensation. Tesla has announced a compensation plan for Elon Musk that may, in the end, be worth 1 trillion. The suggestion, besides an executive reward, is also the Tesla roadmap of the decade - a bet on artificial intelligence, robotaxis, humanoid robots, and scale autonomy.

The Trillion-Dollar Reward

The scheme, as outlined in the latest proxy filing by Tesla, would award Musk further shares of Tesla in 12 tranches, assuming that he achieves market capitalization and operating milestones. The commercial ambition is itself startling: the Tesla valuation can rise from about $1.1 trillion today to 8.5 trillion in a decade to become more valuable than any corporation in history.

Yet financial growth is not enough. Musk will also have to achieve ambitious targets in his operations to unlock the shares:

• Install 1 million robotaxis into commercial operation. 
• Make and manufacture 1 million Optimus humanoid robots.
• Sell 20 million vehicles of Tesla a year.
•  Grow adjusted EBITDA to 400 billion

Everything is stock-based, and personal wealth of Musk is directly related to the technological bets at Tesla.

The Board's View

In a letter to shareholders, Tesla chair Robyn Denholm and director Kathleen Wilson-Thompson said: “Simply put, retaining and incentivizing Elon is fundamental to Tesla achieving these goals and becoming the most valuable company in history.”

The package is structured to keep Musk at Tesla for at least a decade, amid rising concern that his attention is split across ventures like SpaceX, Neuralink, xAI, and the Boring Company.

Musk proposed it following the pay plan of over 50 billion that he had in 2018, previously rejected by a court in Delaware this year. Opponents cited that Musk had an inappropriate level of influence on the Tesla board, which consisted of long-time allies. The ruling is currently being appealed, where the company will make its arguments in October. 

Other investors are concerned with the concentration of Musk due to the drop in sales of Tesla, profit reduction, and his growing interests in politics and other ventures. Musk was even the largest donor to Donald Trump in his 2020 re-election, until their relationship deteriorated in public view, which resulted in vandalism of Tesla outlets. 

Despite the turbulence, Tesla claims that the leadership of Musk is indispensable. The board recognised in filings that his elevated public profile draws a lot of attention, but rejected the idea that his personal opinions or external interests corrupt his performance.

The Tech Bet

This pay scheme is not merely a financial scheme- it is the Tesla roadmap to technology. Linking the success of Musk to AI milestones, autonomous vehicle milestones, and humanoid robotics milestones, Tesla is telling the world that its scope of success is far broader than cars.

Recently, the company introduced a small number of driverless taxis in Austin, the first phase toward its bigger robotaxi vision. With the scale of these technologies, Tesla would cease to be an automaker but a key participant in the AI-based mobility and robotics economy. 

The investors of Tesla have the finalized package of $1 trillion in their hands. They are also faced with the decision of either approving the largest executive compensation plan in history, one that would see Musk become the first trillionaire in the world, provided Tesla can transform technology on a planetary level.

To the shareholders, it is a question of belief in Musk to deliver as much as it is about Tesla to be the leader in the next wave of artificial intelligence and automation.