Inside Elon Musk’s $1 Trillion Ultimatum to Tesla

Tesla’s board of directors has disclosed that Elon Musk threatened to leave the company during acrimonious talks for a new $1 trillion performance-based pay package, threatening to walk away if not approved.

The carmaker outlined the aggressive plan in an SEC filing earlier this month, one of the largest business compensation plans in history. The plan pegs Musk’s compensation to a string of long-term goals — such as increasing Tesla’s market capitalization to $8.5 trillion by 2035.

Musk’s Ultimatum: “Assure My Control or I Leave”

The company, according to Tesla’s filing, met with Musk 10 times before approving the proposal. During the discussions, Musk allegedly informed the board that he wanted a 25% voting share at Tesla — close to doubling his current holding — in order to have control over strategy.

The filing states Musk “raised the prospect that he would pursue his other passions and depart Tesla” if his request was not fulfilled, a threat the board found to be “sincere.”

Tesla stated the new pay plan was “crucial” to maintaining Musk’s leadership, while also allowing his political activities “to wind down in an orderly fashion.” https://fortune.com/2025/10/23/elon-musk-tesla-shareholders-ceo-1-trillion-dollar-pay-package-corporate-terrorists-glass-lewis-iss/

What’s in the $1 Trillion Pay Plan

The new package gives Musk 12 tranches of stock options linked to performance targets. These include:

Raising Tesla’s market capitalization from an estimated $1 trillion to $8.5 trillion by 2035.

Selling an additional 12 million electric vehicles.

Reaching 10 million autonomous driving subscriptions.

Deploying 1 million Robotaxis and 1 million Tesla Bots.

Bringinging in $400 billion in adjusted annual earnings.

If all of these targets are achieved, Musk’s overall holding in Tesla could increase to around 25%, ensuring his grip on the automaker’s long-term strategy.

Board Chair: “Keeping Elon On Board Is Central”

In a letter to shareholders, Tesla Chair Robyn Denholm justified the strategy as critical to ensuring Tesla continues to innovate and lead on the world stage.

“Simply put, keeping and motivating Elon is central to Tesla’s success and becoming the most valuable company in history,” Denholm said.

She went on to say that Musk is the one person “able to lead Tesla at this momentous inflection point,” as it ventures further into artificial intelligence, robotics, and autonomous mobility.

Shareholder Vote Will Determine Tesla’s Future

The pay plan will go up for a final shareholder vote at Tesla’s annual general meeting on November 6, when shareholders will decide whether or not to approve the record-setting deal.

Denholm has warned that a rejection could prompt Musk’s departure, leaving the firm uncertain about its leadership and long-term direction.

“Without a formal incentive plan, Tesla may lose the focus and innovation that have characterized its success,” she cautioned.

Market Response

Shares in Tesla climbed 2% in premarket trading on Friday after the filing but are down almost 30% since mid-December, as investors fret about slowing EV sales and Musk’s increasing political scandals.

To date, Musk’s net value is $430.9 billion, as per Forbes, making him the world’s richest individual, slightly ahead of Larry Ellison, Mark Zuckerberg, and Jeff Bezos.

Governance Scrutiny and Legal Clouds

The move follows increased scrutiny of corporate governance at Tesla. A Delaware court earlier this year invalidated Musk’s 2018 compensation plan as “flawed” due to conflicts of interests and insufficient independent monitoring.

In turn, Tesla’s board has committed more stringent controls and increased transparency in this new proposal. Denholm also asked investors to re-elect three veteran directors who “have worked closely with Elon and are crucial to Tesla’s continued momentum.”

The Stakes Ahead

If it is approved, the new deal will tie Musk to Tesla’s leadership for another decade until 2032, with financial rewards and voting power to guide the company through its next decade of AI, robotics, and mobility innovation.

But if the shareholders turn down the plan, Tesla might be left with a leadership void and stock volatility, given Musk has time and again intimated that he would pay more attention to his other ventures — SpaceX, X (previously Twitter), and xAI — if his conditions are not fulfilled.

“At 15% or lower, the for/against ratio to override me makes a takeover by dubious interests too easy,” Musk wrote on X last year, explaining his push for more voting control.

The outcome of the November 6 vote will determine whether the world’s most valuable automaker can hold onto its visionary — or risk driving into an uncertain future without him.

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