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The shareholders of Tesla approved this Thursday to grant their CEO, Elon Musk, a record compensation package valued at 1 billion dollars in shares, which could make him the world's first billionaire and strengthen his control over the electric vehicle manufacturer.
The proposal was approved by more than 75% of the shareholders, despite the opposition from several institutional funds that had raised concerns about the scale and conditions of the plan.
The board of directors allowed Musk, who already owns about 15% of the shares of the company, to participate in the vote.
The package includes a series of 12 performance objectives related to market value growth, profits, and production, the achievement of which could raise Musk's stake to over 25% of the company's total capital.
During the annual meeting held at the Tesla plant in Austin, Texas, Musk appeared on stage accompanied by an Optimus robot as attendees chanted his name.
"I want to sincerely thank everyone who supported this decision. Tesla is not starting a new chapter, but a new book", he said, visibly emotional.
The chairwoman of the board, Robyn Denholm, had warned days earlier that Musk might leave the company if the plan was not approved.
According to the explanation, the aim of the package is to ensure their commitment to Tesla for at least seven and a half years, at a time when the company is heavily investing in
The South African businessman, who is already the richest person in the world according to Forbes with a fortune exceeding 500 billion dollars, stated that Tesla “will be the most valuable company on the planet” if it succeeds in advancing its autonomous driving and industrial robotics projects.
“Optimus will be the greatest product in history, beyond mobile phones,” Musk stated.
The magnate announced that a production line will be built at the Fremont (California) plant, capable of producing one million Optimus humanoid robots per year, and another in Austin that could manufacture up to ten million units annually.
According to Musk, those robots "will have the potential to eradicate global poverty".
However, the salary package has generated strong criticism. The activist group Tesla Takedown described the decision as “the world’s most expensive participation trophy,” denouncing the recent decline in vehicle sales and the increasing impact of Musk's political stances on the company’s reputation.
They are being given a billion dollars for failing, the collective pointed out.
For their part, the consulting firms Glass Lewis and ISS also opposed the plan, arguing that the billionaire already has sufficient financial incentive to maintain Tesla's course and that a package of such magnitude “could reduce the pressure to achieve all the proposed goals.”
In contrast, analyst Dan Ives from Wedbush Securities praised the approval and stated that the vote “solidifies Musk's position as a leader in the artificial intelligence revolution,” instilling greater confidence in Tesla's future.
The decision positions Musk, 54, as the first executive in history to receive a compensation package of 1 billion dollars, a figure that not only multiplies his fortune but also sets a precedent in the global technology and finance sector.
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