Dan Ives Calls Elon Musk's $1 Trillion Tesla Pay Package ‘Right Decision’

Wedbush analyst Dan Ives said on Friday that Tesla’s  (TSLA) board “made the right decision” in proposing a record $1 trillion compensation package for CEO Elon Musk.

Tesla’s stock was up 2.8% in pre-market trade. On Stocktwits, retail sentiment around the EV maker improved to ‘bearish’ from ‘extremely bearish’ over the past day. The stock was the top trending ticker on the platform at the time of writing.

The deal ties Musk’s compensation to 12 performance milestones that could give Musk more than 423 million additional shares. He currently holds around 13% stake in the company.“ Big goals for Musk and Tesla in this comp package as the AI Revolution takes hold and Tesla heads down the autonomous and robotics path,” he wrote in a post on X. 

Goals for Musk include delivering 20 million Tesla vehicles, putting one million Robotaxis into commercial operation, and delivering one million bots. The new award will take at least seven-and-a-half years and up to 10 years to vest in total. Whether or not the pay package is approved will be determined during the shareholder vote at the November annual meeting.

In a letter to shareholders, Tesla’s board said that it sought “assurances” from Musk that he would “wind down” his political work. They said the pay package was designed to “drive peak performance from our visionary leader.”

The new package, dubbed the 2025 CEO Performance Award, is nearly double the value of Musk’s previous pay package, initially approved in 2018 and valued at over $50 billion. However, the 2018 pay package was voided by a Delaware court, which deemed it excessive, last year. 

Musk appealed the court’s order in March, and Tesla also established a special committee to consider matters concerning Musk’s pay. Last month, the special committee announced that it had approved an interim award of 96 million shares of restricted stock to CEO Elon Musk, valued at approximately $29 billion based on the stock’s last closing price. Tesla clarified that Musk will not be able to keep this award in addition to the options he will be awarded under the 2018 CEO performance award, should the courts rule in his favor.

Read also: Bitcoin Hovers At $112K Ahead Of Jobs Report, Altcoins Flatline

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