Tesla shareholders are set to vote on November 6, 2025, on a proposed compensation package for CEO Elon Musk that could be worth up to $1 trillion if ambitious performance goals are met. The plan has sparked division, with proxy firms recommending rejection while major investors show support. Tesla's board warns that failure to approve could lead to Musk's departure.
The vote, scheduled for Tesla's annual shareholder meeting on November 6, 2025, centers on a performance-based compensation package for Elon Musk that ties rewards to achieving aggressive milestones, including revenue growth and development of products like robotaxis and humanoid Optimus robots. If fully realized over the next decade, the package could value Musk's stake at $1 trillion and grant him more than 25% of the company's voting power, potentially up to 12% of Tesla's stock if the market cap reaches $8.6 trillion by 2035.
Tesla Board Chair Robyn Denholm has urged shareholders to approve the plan, emphasizing in a letter and interviews that it ensures Musk's focus amid challenges like slowing EV demand. She warned that rejection could prompt Musk to leave, stating investors should prepare for him to "abandon ship" and shift to other ventures. Denholm confirmed Tesla would seek an internal successor, naming candidates like Senior VP Tom Zhu, who leads operations in China and was appointed Senior VP of Automotive in 2022, and CFO Vaibhav Taneja.
Musk has framed the package less as financial gain and more as securing influence, particularly over Tesla's future in robotics. During the Q3 earnings call, he said: "My fundamental concern with regard to how much voting control I have at Tesla is if I go ahead and build this enormous robot army, can I just be ousted at some point in the future? That’s my biggest concern... I don’t feel comfortable wielding that robot army if I don’t have at least a strong influence."
Support comes from investors like the State Board of Administration of Florida, which manages over $280 billion and holds more than $1 billion in Tesla shares; it called the plan a "bold, performance-driven incentive structure." ARK Invest CEO Cathie Wood, whose firm holds about $1 billion in Tesla stock, predicted approval and "super-exponential growth." Wedbush analyst Dan Ives backed it to keep Musk focused on autonomy and robotics, quipping he had a better chance of starting for the New York Yankees than the package failing. Analyst Gary Black echoed this, stating there is a "near-zero chance" of rejection, with betting platform Kalshi showing a 94% approval probability.
Opposition includes proxy firms Institutional Shareholder Services (ISS) and Glass Lewis, which recommended voting against; Musk labeled them "corporate terrorists." New York State Comptroller Thomas DiNapoli, whose retirement fund holds 3.5 million Tesla shares worth $1.7 billion, criticized the board's "alarming lack of independence" and called the deal "pay for unchecked power." The American Federation of Teachers and other unions argued it fails to secure Musk's commitment to Tesla.
Tesla's recent performance adds context: Q3 2025 deliveries reached 497,099 vehicles, up 7.4% year-over-year, boosted by price cuts and expiring U.S. EV tax credits. Shares have risen about 80% year-to-date, closing around $460 on October 28, 2025, though analysts are split with an average price target of $365.