Tesla (TSLA) shareholders have approved CEO Elon Musk's $56 billion pay package and the company's move from Delaware to Texas, signaling strong confidence in Musk's leadership despite ongoing challenges. The approval also included the re-election of board members Kimbal Musk and James Murdoch. However, shareholders increased investor control by shortening board terms and lowering voting requirements for proposals.
Onstage at the meeting, Musk described himself as pathologically optimistic, emphasizing his ability to deliver results. The approval of the pay package highlights the support Musk enjoys from Tesla's retail investor base, even as some large institutional investors opposed the package. Tesla did not disclose voting tallies immediately, but they are expected in the coming days.
Market Overview:- Tesla shareholders approve Elon Musk's $56 billion pay package.
- Company to move legal home from Delaware to Texas.
- Retail investors show strong support for Musk despite institutional opposition.
- Musk's optimism and promise of delivery resonate with retail investors.
- Shareholder approval includes re-election of Kimbal Musk and James Murdoch.
- Legal battles continue despite shareholder endorsement.
- Musk's leadership and strategy remain crucial for Tesla's future.
- Potential new lawsuits over the pay package loom.
- Focus shifts to Tesla's ongoing innovations and market performance.
The approval serves as an endorsement of Musk's tenure, reflecting investors' unwillingness to risk Tesla's future without his leadership. However, Musk still faces legal challenges, with a Delaware judge previously invalidating the pay package and potential new lawsuits on the horizon. Despite these hurdles, shareholders' confidence in Musk's vision and strategy for Tesla remains steadfast.
Musk has added two more companies to his roster since the pay package was approved in 2018. He now runs or owns six firms, including rocket-builder SpaceX, social media giant X - formerly Twitter - and the artificial-intelligence firm xAI, which Musk created in 2023. The approval suggests shareholders "think he's the only person with the best strategy to implement going forward," said Jason Schloetzer, a business professor at Georgetown University with expertise in corporate governance. Tesla's share price has dropped about 60% from its 2021 peak as EV sales have slowed and Musk's attention has wavered between Tesla and other companies he runs. The stock closed up 2.9% on Thursday.
