Tesla’s Board Just Offered Elon Musk $1 Trillion to Lower His Expectations

Tesla has proposed a new compensation package for Elon Musk that could be worth an astronomical $1 trillion, tying his pay to a series of moonshot goals. But look past the headline-grabbing number, and you’ll find this isn’t a reward for future audacity. It’s a beautifully crafted, ten-figure reality check—a corporate intervention designed to formally walk back some of Musk’s most famous, and famously broken, promises.

Key Takeaways

Tesla’s board has proposed a new 10-year, $1 trillion compensation plan for CEO Elon Musk, which will be put to a shareholder vote in November.
Many key product goals are drastically “watered-down” versions of Musk’s previous public promises, such as delivering 20 million cars total over 10 years, not 20 million per year.
If all milestones are met, the package would grant Musk over 423 million shares, boosting his voting control from 13% to nearly 25%—a key demand he recently made.
The plan’s financial targets remain immense, requiring Tesla to reach an $8.5 trillion valuation and generate $400 billion in annual earnings.
The deal reportedly includes other significant clauses, requiring Musk to develop a CEO succession plan and provide “assurances” that he will wind down his political activities.

The World’s Most Expensive Goalpost Move

In its proxy statement, Tesla’s board talks about creating “the most valuable company in history.” But the actual product milestones feel less like a launch to Mars and more like a gentle return to low-Earth orbit. The details of the plan read like a formal retreat from the hyper-growth narrative Musk has championed for years.

The most glaring example is vehicle production. For years, Musk claimed Tesla would be making 20 million electric vehicles per year by 2030. That promise was a cornerstone of the company’s valuation, made when Tesla was still vowing to grow 50% annually. But after sales growth stalled and then reversed in 2024, that goal was quietly dropped. The new pay package now asks Musk to deliver 20 million vehicles… total… by 2035. Considering Tesla has already sold eight million cars, this new target is significantly less ambitious.

It’s the same story for robotaxis. The infamous 2019 promise of one million robotaxis on the road by 2020 has become a tech industry punchline. The new goal? Reach a “daily average aggregate” of one million robotaxis in commercial operation. The fine print is revealing: this can include customer-owned vehicles on the network, and the definition of a “Robotaxi” is any Tesla using its Full Self-Driving software.

Even the much-hyped Optimus robot gets a reality adjustment. Musk recently claimed Tesla could be making one million humanoid bots per year by 2029, which he says could one day represent 80% of Tesla’s revenue. The board’s new target for a trillion-dollar payday is far more modest: a total of one million bots by 2035, with the board noting that “commercialization plans” are “still in development.”

The Trillion-Dollar Handcuffs

While the product goals have been scaled back, the package does deliver on one of Musk’s biggest recent demands: control. Musk previously threatened to develop AI ventures outside of Tesla if his voting stake wasn’t increased. This new plan would grant him enough shares to boost his ownership to around 25%, effectively giving him the control he wanted.

In what looks like a classic C-suite negotiation, the board seems to be trading that control for a set of behavioral guardrails. Tucked away in the agreement are two notable assurances: that Musk will work on a CEO succession plan, essentially locking him to the company for at least 7.5 years, and, per a footnote reported by TechCrunch, that his “involvement with the political sphere would wind down.” It’s an attempt to address governance concerns that have dogged the company for years, including potential conflicts of interest with Musk’s other ventures like xAI.

The package, in effect, attempts to tether Musk more securely to Tesla, both with the promise of unprecedented wealth and a few non-negotiable corporate leashes. It’s an expensive pair of golden handcuffs.

But Seriously, an $8.5 Trillion Company?

Even with its scaled-back production targets, the plan’s financial ambitions are nothing short of breathtaking. To unlock the full $1 trillion, Musk must guide Tesla to an $8.5 trillion market capitalization and generate an astonishing $400 billion in annual earnings—a gargantuan leap from last year’s $17 billion.

To put that valuation in perspective, it would require Tesla to surpass the current combined market caps of Apple, Microsoft, and Nvidia. Critics argue such goals risk creating a “Hail Mary” effect, pushing the company toward high-risk strategies. But for a CEO who once claimed Tesla could be worth more than the top five most valuable companies combined, a target of $8.5 trillion might just be his version of “realistic.”

Why It Matters

This isn’t just another story about obscene executive pay. The proposed $1 trillion package is a masterclass in corporate maneuvering. Tesla’s board has managed to draft a compensation plan that simultaneously appeases its indispensable, and often restless, CEO while subtly course-correcting the company’s official narrative.

This is a formal, document-backed admission that the company’s previous hyper-growth promises were unsustainable. It’s the board using an astronomical sum of money to manage expectations—those of the market, of investors, and perhaps most importantly, of Elon Musk himself. By codifying these “watered-down” targets, the board is swapping out the myth of infinite, exponential growth for a new set of goals that are merely wildly, absurdly ambitious. This is the fascinating theater of trying to attach a balance sheet to a supernova.

Conclusion

When shareholders vote in November, they won’t just be approving a pay package. They’ll be endorsing a strategic recalibration. They are being asked to fund a plan that both rewards Musk’s past hyperbole and attempts to rein it in for the future. It’s a high-stakes bet not just on Tesla’s ability to dominate AI and robotics, but on whether a trillion dollars is finally enough to anchor Elon Musk to planet Earth.