Amid what can only be described as a rollercoaster of a year for Tesla, the electric vehicle maker confirmed a gargantuan pay package for CEO Elon Musk, the company said in a post on X.
Once an unshakeable titan in the rapidly surging EV sector, Tesla's been contending with sustained headwinds throughout 2025.
Musk's controversial involvement in sweeping cuts to a broad swath of popular federal programs like USAID caused a tremendous amount of anti-Tesla backlash and ensuing stock volatility. Sales faltered, and some of Musk's most vocal supporters feared the damage was "irreversible."
By itself, fallout from Musk's activities appeared to do significant damage to Tesla's previously beloved brand — but it wasn't the only challenge the automaker faced.
Compounding innovations in EV technology introduced a level of competition from up-and-coming, rival electric vehicle makers. China's BYD was catching up to Tesla by early 2024, and newer brands only stood to gain market share as Tesla flailed.
As the Associated Press indicated, Tesla's stock value dipped 25% this year, and "profits plunged from $1.39 billion to $409 million" in the most recent quarter.
However, on Monday, August 4, Tesla issued a letter to shareholders announcing Musk's compensation package and some caveats attached to it. The company awarded Musk "96 million restricted shares of stock" valued at roughly $29 billion, according to CBS News.
Tesla published a copy of the letter to X, which began by saying Musk had "not received meaningful compensation for eight years," and that the award was "recommended … as a first step, 'good faith' payment to Elon" by members of Tesla's Board of Directors.
"Rewarding Elon for what he has done and continues to do for Tesla is the right thing to do," the letter stated, citing an ongoing legal tug-of-war around Musk's compensation. Directly thereafter, an emphasized heading asserted that "retaining Elon [was] more important than ever before."
Musk was referred to as "Elon" throughout the letter, which also held that "losing Elon would not only mean the loss of his talents but also the loss of a leader who is a magnet for hiring and retaining talent at Tesla."
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Ultimately, the Board assured fretting shareholders that the multibillion-dollar package would be sufficient to keep "Elon's energies focused on Tesla" and would require him to remain "continuously in a senior leadership role" for a two-year period.
The price of Tesla shares rose 2% on Monday, possibly reflecting a modest swing in investor sentiment.
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