Tesla doubles down on Elon Musk — offering a $29 billion stock package as the automaker faces falling sales, legal turmoil, and political backlash.
📰 Tesla Makes Bold $29 Billion Offer to Retain Elon Musk
Tesla has extended a staggering $29 billion stock award to CEO Elon Musk, hoping to secure his leadership during a turbulent time for the company. The package mirrors Musk’s original 2018 compensation plan, which was recently voided by a Delaware court, citing governance failures.
Despite the legal setback, Tesla’s board is offering Musk 96 million stock options at $23.34 per share, the same price set in the original plan. However, there’s a catch: Musk must remain in a top executive position for at least two more years and await the final ruling on his previous compensation.
📉 Context: Tesla’s Slump in Sales and Reputation
The move comes as Tesla faces multiple headwinds:
| Challenge | Details |
|---|---|
| 📉 Sales Decline | Aging vehicle lineup and intense competition from legacy and Chinese EVs. |
| 🚩 Political Controversy | Musk’s vocal support for Donald Trump and polarizing social media presence. |
| 🔄 Brand Loyalty Drop | S&P Global Mobility reports steep decline in returning customers. |
| 🤖 Risky Strategic Shift | Transitioning focus from EVs to robotaxis and humanoid robots. |
📈 Musk’s Influence Remains — But at a Cost
If the plan goes forward, Musk’s stake in Tesla would increase from 12.7% to over 15%, consolidating his control and influence.
Yet the company stated it won’t count this as a current expense because performance targets are unlikely to be met soon. Moreover, if the court reinstates the previous $50 billion package, this new one will be voided or adjusted to prevent duplication.
💬 “This isn’t just a retention deal — it’s Tesla signaling that Musk is still essential to the company’s future,” said one Wall Street analyst.
⚖️ Critics Call It a Legal Loophole
Governance experts are alarmed by Tesla’s move. Critics see the new package as a thinly veiled attempt to sidestep the court’s ruling.
🧑⚖️ “It’s essentially the same plan that was struck down. Musk already has every incentive to stay,” said Charles Elson, corporate governance expert at the University of Delaware.
📊 Market Reaction: Investors Cheer, Analysts Wary
Despite the drama, the market gave a thumbs up — Tesla shares rose nearly 2% after the announcement.
| 📈 10-Year Stock Performance |
|---|
| Tesla: +1,900% |
| S&P 500: +200% |
Why investors support Musk:
- 📌 Historical growth under his leadership
- 🔋 Continued innovation despite controversy
- 🤝 Belief that only Musk can drive Tesla’s next phase
Still, analysts warn of reputational damage and governance concerns if Tesla continues bending rules to accommodate its CEO.
🔮 What’s Next?
Tesla’s future is now tied closer than ever to Elon Musk — for better or worse.
While legal battles continue, and sales waver, the automaker is making a high-stakes bet: That the same man who led them to the top, despite his unpredictable behavior and political firestorms, is still their best shot at navigating the future.
🔍 Summary: Key Takeaways
| Tesla’s $29B Deal with Elon Musk | Implication |
|---|---|
| 96M shares @ $23.34 each | Mirrors the voided 2018 deal |
| Must stay CEO for at least 2 more years | Retention strategy amid legal uncertainty |
| Stake grows from 12.7% → 15% | Increases Musk’s control |
| Not counted as expense (yet) | Based on unmet performance targets |
| Overlaps with court case | Could be canceled if original deal is reinstated |
| Sales and loyalty in decline | Tied to political controversy and outdated vehicle line |
| Shares rise ~2% after announcement | Investors still believe in Musk’s long-term vision |
| Critics call it legal workaround | Governance concerns remain |
📌 Bottom Line:
Tesla is going all-in on Elon Musk — even if it means rewriting the rules, raising eyebrows, and risking shareholder trust. As the company navigates its next era of innovation, it’s clear that Elon Musk remains Tesla’s most valuable — and volatile — asset.
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