Tesla Approves $29 Billion Share Award for Elon Musk Amid Court Dispute

 

Tesla has granted CEO Elon Musk a new share award worth approximately $29 billion as part of a revised compensation plan aimed at retaining him during a critical transition period. This move comes after a Delaware court invalidated Musk's $50 billion pay package from 2018, citing issues in the approval process and unfair treatment of shareholders.

The new grant, approved by Tesla’s board, consists of 96 million shares and is designed as a “good faith” gesture while the company awaits the outcome of Musk’s ongoing legal appeal. The shares will only vest if Musk remains in a key executive role through 2027 and are subject to a five-year holding period.

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Tesla emphasized that the award aligns Musk’s interests with shareholders and aims to keep him focused on its future in AI, robotics, and autonomous driving, rather than stepping away. A longer-term compensation plan will be voted on at Tesla’s November 6 investor meeting.

Tesla’s decision to reissue the share award comes as the company faces slowing sales, an aging vehicle lineup, and increasing competition in the EV market. Once known for rapid growth, Tesla is now shifting focus toward robotaxis and AI, including humanoid robots, as traditional car sales decline.

Some investors, including former Tesla bull Gary Black, view the move positively, believing it secures Musk’s attention at a critical moment. However, corporate governance experts argue it undermines the Delaware court’s prior ruling, with some calling it a mere repackaging of an already rejected deal.

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The stock rose over 2% in premarket trading following the news but remains down around 25% this year. Analysts forecast another year of declining sales in 2025, and Musk himself has warned of “rough quarters” ahead due to waning EV subsidies. Meanwhile, Tesla’s new robotaxi trial in Austin, Texas, faces regulatory hurdles before broader deployment.