Tesla Inc. has approved a massive $29 billion share award for CEO Elon Musk, granting him 96 million new shares in a move aimed at securing his continued leadership as the electric vehicle maker faces legal challenges and strategic shifts.
The new compensation package comes in the wake of a 2024 Delaware court decision that voided Musk’s 2018 pay deal, originally valued at over $50 billion, ruling that the process used by Tesla’s board to approve it was flawed and unfair to shareholders. Musk has since appealed the ruling, arguing that the court made multiple legal errors.
In a regulatory filing on Monday, Tesla said a special committee of the board approved the new interim award to ensure Musk remains focused on the company’s evolving mission. The shares will only vest if Musk retains a key executive role through 2027 and are subject to a five-year holding period, except for covering taxes or the purchase price. Musk must pay $23.34 per share, mirroring the exercise price of the 2018 award.
The committee emphasized that the new award will not result in double compensation. If the 2018 package is reinstated by the courts, the interim award will either be forfeited or offset.
“While we recognize Elon’s business ventures, interests and other potential demands on his time and attention are extensive and wide-ranging … we are confident that this award will incentivize Elon to remain at Tesla,” the committee stated.
Tesla shares rose over 2% in premarket trading following the announcement.
The move comes at a critical juncture for Tesla. Musk, Tesla’s largest shareholder with a 13% stake, is steering the company away from its long-promised affordable EV platform toward robotaxis and humanoid robots, signaling a transition from car manufacturing to artificial intelligence and robotics.
But the company is also grappling with slumping sales, a decline in brand loyalty, and intensifying competition. Tesla’s stock has lost about 25% of its value in 2025, driven by an aging vehicle lineup, reduced U.S. government subsidies for EVs, and Musk’s polarizing political stances, including his vocal support for former President Donald Trump.
The Cybertruck, Tesla’s only new model since 2020, has underperformed commercially despite Musk’s projections of massive demand.
In a recent earnings call, Musk acknowledged the rough road ahead, citing subsidy cuts and softening consumer interest. He predicted that financial relief could come late next year through revenue generated by Tesla’s self-driving software and related services.
Tesla’s future now rests heavily on whether Musk can deliver on that vision, and whether shareholders, regulators, and courts will continue to back his leadership.
Written By Rodney Mbua
