Tesla Awards Boss Elon Musk $29 Billion In Shares

Tesla has awarded CEO Elon Musk a staggering $29 billion (£21.7 billion) in shares in a strategic move to retain the billionaire entrepreneur amid an intensifying global battle for artificial intelligence (AI) talent. This development follows a U.S. court’s decision to strike down Musk’s original 2018 pay package – valued at over $50 billion on the grounds that it was “unfair to shareholders.”

Although the Delaware court ruled in 2024, Musk is already appealing the ruling, claiming that the court committed legal mistakes and that the issue of compensation should be decided by Tesla shareholders. Tesla was optimistic on Monday that the new share award of 29 billion would act as a great motivator for Musk to stay with the company, even as tech companies intensively seek the best AI talent.

The Tesla board elaborated that we must keep and inspire our remarkable talent, starting with Elon, in a post on X, the social network owned by Musk. The board emphasized the unique leadership and technical expertise that Musk possessed, noting his ability to develop “revolutionary and profitable businesses.”

It is also likely that the share award will strengthen Musk’svoting power in Tesla as the company shifts its focus to AI and robotics.

In the case of the Delaware court reinstating Musk’s 2018 deal, Tesla said that Musk would repay the new shares to prevent what it called a double dip. That initial agreement, which could have totaled as much as $56 billion, would represent the biggest compensation package in corporate U.S. history, provided he met performance milestones, all of which he did.

Dan Ives, an analyst at Wedbush Securities, told the BBC the move was necessary. Musk is the greatest asset to Tesla… the company cannot afford him to be half-baked in the AI arms race.

As competitors such as Meta and Microsoft actively snatch the best AI engineers, Tesla underlined that the company is at an inflection point and requires the full attention of Musk to spearhead its transition into an AI and robotics powerhouse. Musk, the head of xAI, Neuralink, and The Boring Company, is supposed to be the key figure in driving Tesla toward the next chapter of its existence.