Musk’s $1.5 trillion pay proposal. Is he worth it?

September 8, 2025 — 3.48pm

The $US1 trillion ($1.5 trillion) pay package the Tesla board has proposed for Elon Musk is one of those jaw-dropping statistics that takes some time for people to come to grips with.

Already the world’s richest man, the proposed compensation package would be worth more than the GDP of all but the 20 largest countries in the world. Obscene, disgusting or vulgar can’t begin to describe the notion of awarding one person that level of compensation for leading a company.

Elon Musk could be become the one-trillion-dollar man.Credit: AP

This is one for the history books, even for the US where corporate pay packets can run into the hundreds of millions. This remuneration package, devised by the Australian who chairs Tesla – Robyn Denholm – sits miles outside the bell curve.

The obvious question here is whether any person could be worth that much? If the answer to that question is no, then readers will be baffled by how investors reacted to the news of Musk’s proposed pay packet – Tesla shares went up 3 per cent.

The reason for that is, because to win the trillion dollars, Musk will need to surmount such colossal earnings and growth hurdles that he would metaphorically need to reinvent the wheel. The chances of him doing that are considered zilch.

Loading

And if he does manage the improbable miracle, then Tesla’s stock price, market capitalisation and earnings would be propelled into such stratospheric heights that shareholders will be richer than their wildest imaginations.

Musk managed to do the impossible in 2018, when he was set seemingly impossible hurdles, and clearly some intrepid investors are punting that he can repeat that feat.

The compensation plan sets 12 goals for the market cap, starting at $US2 trillion, about 75 per cent up on the current valuation, and rising after that by $US50 billion increments to an incredible $US8.5 trillion, the equivalent of double the size of today’s most valuable company, Nvidia.

But there’s more!

There are a series of other hurdles – half of which involve earnings targets, and six others for such achievements as putting 1 million robotaxis in circulation and selling 10 million full self-driving cars.

The obvious question here is whether any person could be worth that much?

It’s not an all-or-nothing package. If Musk reaches some of the milestones, he will receive large lashings of Tesla stock; if he scales the peak successfully, he ends up with 25 per cent of the company – roughly twice what he currently owns.

Why not? Tesla chair Robyn Denholm has proposed the pay package for Elon Musk. Credit: Alex Ellinghausen

Loading

The backdrop against which this Tesla announcement was made is ironically the poor performance of the company, whose promised milestones on robotaxis and self-driving cars have been regularly missed and its profitability engine, electric cars, has suffered a decline in worldwide sales for the first two quarters of this calendar year as competition from Chinese manufactures such as BYD has intensified.

Thus, the Tesla board, which is already in a legal battle with a group of shareholders that is challenging Musk’s previous $US56 billion pay package, is demonstrating what it feels is the reliance on its maverick chief executive to exercise his innovation skills to catapult the company into another league.

To get the pot of gold at the end of the rainbow will require Musk’s full attention – something that has not been a feature this year in particular thanks to his diversion into politics as an early Donald Trump supporter and leader of the US president’s department of government efficiency (DOGE).

More recently, a falling out with Trump and threats by Musk to establish a new political party have put Tesla’s commercial treatment at risk.

While Musk has recently gone quiet on these political ambitions, his attention has moved to the UK where he is whipping up an anti-immigration frenzy.

Sole focus on Tesla alone appears outside Musk’s capability.

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.

Most Viewed in Business

Loading