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-   -   Elon Musk could leave Tesla if his $56 billion compensation package isn't approved (https://www.team-bhp.com/forum/international-automotive-scene/281450-elon-musk-could-leave-tesla-if-his-56-billion-compensation-package-isnt-approved.html)

According to a media report, Tesla could be on the verge of losing its CEO, Elon Musk, if the company shareholders don't approve his massive $56 billion pay package.

The decision is said to take place on June 13th, when Tesla's shareholders will decide the fate of Musk's compensation, estimated to be worth $56 billion. Ahead of the meeting, Tesla Board Chair Robyn Denholm is calling on the company's shareholders to approve Musk's pay package and not risk driving the CEO away.



Denholm stated, "Elon is not a typical executive, and Tesla is not a typical company." He further added, "So, the typical way in which companies compensate key executives is not going to drive results for Tesla. Motivating someone like Elon requires something different."

The Tesla Board Chair went on to state, "What we recognized in 2018 and continue to recognize today is that one thing Elon most certainly does not have is unlimited time. Nor does he face any shortage of ideas and other places he can make an incredible difference in the world. We want those ideas, that energy and that time to be at Tesla, for the benefit of you, our owners. But that requires reciprocal respect."

Reports state that if the shareholders approve Musk's $56 billion package, it would make him the most highly compensated chief executive in modern history.

However, Denholm, implying that the large pay package would be a "motivation" for Elon to stay, speaks to the fear of some investors. Reports also suggest that with Musk now running different projects, including SpaceX, The Boring Company, Neuralink, X and xAI - it has taken away his attention from Tesla.

Source: TheVerge

Link to Team-BHP news

Musk also spends significant amount of time creating memes:

I wanted nearly 2.5 years to say this... "(if)Musk is leaving Twitter, let it..."

This a meme worthy news. I am sure people will be having a wild run with it.

That said, Elon has reached a point where he has become a liability and is hurting the Tesla brand. At the same time, Tesla without Elon is unimaginable. This is actually a nice way to leave for Elon and focus on his other Projects. But, at this point the EV world is no more looking upto Tesla as it used to do. I hope if that was to happen, some of the Lucid members consider coming back and lead Tesla.

Elon has his positives and negative. But no one can discount the tremendous value he brought to the shareholders. It is wrong for anyone to take away something that is promised as a reward for a job well done. He is only claiming what is his and there is nothing wrong with it.
If Elon leaves Tesla he will also lose out big on his net worth, but then he can afford to lose a few billions. Will that be true to Tesla shareholders too?

Musk isn't demanding anything extraordinary, he met the conditions of the payout and it was denied through lawfare. The court overturned the decision of the board and 80% of the shareholders in favour of 9 shares. The reason is political, Musk has destroyed the traditional media narrative with Twitter, and it's a far more interesting space after his takeover.

OT but adding to this, he also seems to be throwing a complete tantrum online on X against OpenAI and Apple's collaboration.

Without Elon, Tesla stock prices will crash. Never bet against Elon Musk. He has a loyal backing of the majority of the shareholders. This is purely political.

If he decides to leave, a good chunk of the Tesla AI team will leave Tesla to join xAI. He may even taken on Google and Apple with his own phone and OS.

Elon Musk is a liability to Tesla and the auto industry at large now. I will admit he pioneered a concept many were skeptical of and took it mainstream. Tesla is a huge reason people are considering EVs as a very plausible choice to replace ICE powered vehicles. We have to give the man credit where it's due. But he's gone off the rocker, of late.

Trying to promote absurd narratives, allowing extreme voices on his platform, are all red flags. But those are to the side. What is inexcusable is how he's hurting Tesla's design choices itself. The yoke with stupid buttons. Controlling everything through the screen with weird interfaces for simple stuff like drive selection. The dumpster fire that is the Cybertruck... Worst of all is the still shoddy QC and objectionable decisions regarding the full self driving feature. Of course, holding him personally responsible for a few of these mix ups may not be warranted. But the fact is that, Musk has gone on air making plenty of dangerous claims and unserviceable quotes to consumers and shareholders.

It is high time someone grew a spine and held this man-child accountable for his actions as the leader of a multi-billion dollar automotive business. They should vote him out before he runs Tesla into the ground with his irrational nonsense.

So, it is ok to layoff hundreds of employees who have given their all to the company in the name of cost cutting, but it is not ok for the CEO to take a pay cut?

Elon Musk being the CEO was not paid a penny, the terms agreed by the shareholders was no to CEO salary or any cash pay but if he is able to grow the company, he gets the stock option which is now worth $56 Billion.

On top of it, the legal team representing the fringe share holders who opposed Musk payout is asking Tesla $5 billion as legal fees. Which is even more of a day light robbery.

Tesla also argues that it would cost them $25 billion in accounting charge to come up with a new pay structure for Musk because of the current price of the TSLA stock.

It is not about the backing of the majority of the shareholders. It is about how do the majority of eligible votes actually votes.
(Musk own shares and those of his brother don’t count)

So the main shareholders that own big blocks of shares, are the ones that make it count.

Currently about 30% of the stock is held by individual shareholders and retail. The board is trying to mobilize these folks. Because those are more often than not, the Musk Groupies. Admirers with no criticism.

There are several big investors holding anywhere from2-6% of the shares and thus the votes.

Not sure what is political here. Shareholders are in it for the money. Some believe it’s time for Musk to be moved out, others don't.
Different views/opinions as what the best way to make money out of Tesla.

If you are an investor in Tesla you got plenty to worry, look at the share price over the last years!



As a shareholder there is plenty to blame Musk. He has not delivered the value that shareholders believe he should have. His behaviour has more than once caused huge dips in the share price.

The pay package was considered unfair to investors by a US court. So the board is trying to redo the whole thing to prove legitimacy.

Reuter has a good article explaining some of the reasoning of the court and what has been happening to Tesla and Musk.

https://www.reuters.com/legal/judge-...ge-2024-01-30/

I am not a fan of Musk. Never have, never will be. Terrible individual that has grown into a symbol of everything that is wrong with unbridled and unchecked capitalism. Just my opinion.

Jeroen

I'm not a Elon fanboy. But you can't ignore Elon. If he leaves, Tesla will become a regular car company in 3-5 years without any ambitious/ridiculous goals such as Autopilot advancements, robotaxi, optimums etc.

Shareholders are in a tight spot here. Not having Elon as CEO is good for Tesla in the short-term, but Elon outside is a bigger threat business wise.

My prediction: TSLA will lose $100B in market-cap if he leaves.

Look at the share price graph I shared. Under Musk in the couple last years the company lost more than double that!

Jeroen

I'm saying it will lose another $100B (reaction to the news, if he leaves). This is my prediction, I could be completely wrong.