Tesla Board Chair Robyn Denholm warned shareholders that they must vote to pay CEO Elon Musk almost $1 trillion, or he might not stay.
“Without Elon, Tesla could lose significant value, as our company may no longer be valued for what we aim to become,” Denholm wrote ahead of Tesla’s annual meeting on Nov. 6. Online shareholder votes regarding Musk’s new pay plan and other proposals must be received by Tesla by or before 11:59 p.m. ET on Nov. 5.
Denholm argued that Musk is key to the future of the EV maker as it moves beyond being “just another car company,” with a bigger focus on Full Self Driving (FSD) and Optimus.
Musk had faced criticism earlier this year for neglecting Tesla as he worked for President Donald Trump, leading the Department of Government Efficiency (DOGE). His controversial role in the administration, and his polarizing comments have also given rise to backlash against the company.
READ: Elon Musk defends $1 trillion pay package, slams opposing advisory firms (
Several groups have opposed the pay package with Institutional Shareholder Services, the biggest proxy advisory firm in the world, recommending against its “astronomical” value. Last week, a group of unions and corporate watchdogs launched the “Take back Tesla” website to oppose the pay package, citing Musk’s right wing politics and amplification of conspiracy theories.
Musk lashed out at top proxy advisors ISS and Glass Lewis, calling them “corporate terrorists” on an earnings call with analysts last week. “I just think that there needs to be enough voting control to give a strong influence,” Musk said, interrupting his CFO at the tail end of a 75-minute call. “But not so much that I can’t be fired if I go insane.”
ISS says it stands by its report. A spokesperson for Glass Lewis told CNBC: “Our job as a proxy advisor is to provide informed analysis and recommendations to our clients worldwide. Those that are Tesla shareholders will ultimately make their own decisions about Mr. Musk’s pay proposal and the Board directors that put it forward for shareholder vote.”
Denholm told CNBC’s “Squawk Box” that the company is at an “important inflection point” with artificial intelligence at the forefront.
READ: NHTSA investigates over 2 million Tesla vehicles over safety concerns (
“The opportunity for Tesla in the future, given this AI focus and attention and the unique capabilities that we have as an organization, and that Elon brings to us, really does mean that the opportunity for the company ahead of us is significant,” she said.
The proposed plan for Musk was outlined by the board in September, and consists of 12 tranches of shares granted to Musk if Tesla hits certain milestones. The first milestone is a market capitalization of $2 trillion. The company is currently worth about $1.5 trillion. The next nine tranches are awarded as the market cap increases by increments of $500 billion, up to $6.5 trillion. The last two tranches bump the increment to $1 trillion, putting a $8.5 trillion market capitalization as the last tranche.
Tesla recently faced scrutiny after the U.S. National Highway Traffic Safety Administration (NHTSA) said it is opening an investigation into nearly three million Tesla vehicles equipped with its Full Self-Driving (FDS). This is being done following more than 50 reports of traffic-safety violations and a series of crashes.