Tesla grants Elon Musk $29 billion pay deal amid challenges

In August 2025, Tesla, the renowned electric vehicle manufacturer, granted its CEO, Elon Musk, a substantial pay deal worth $29 billion. This deal includes a grant of 96 million new shares intended to retain Musk in his role during a challenging period for the company. The decision comes as Tesla is shifting its focus from electric vehicles, which have faced a decline in sales due to increasing competition and a stagnant vehicle lineup, towards a future involving robotaxis and humanoid robots. The new compensation package, described as an 'interim award,' serves as a good faith gesture to honor a previous pay package from 2018 that was invalidated by a Delaware court. Musk must abide by certain conditions, including remaining a top executive for an additional two years and holding the awarded shares for five years at an exercise price of $23.34. This significant compensation move reflects Tesla's desire to keep Musk engaged during its strategic pivot and amid concerns regarding his involvement in other ventures, such as SpaceX and his political activism. Moreover, the substantial pay package underscores the board's continued confidence in Musk as the key leader to navigate Tesla through its ongoing challenges and the competitive landscape in the automotive industry.