Why Musk Doesn’t Need More Tesla Stock

You have to hand it to Elon Musk. While most CEOs would scheme behind closed doors to get awarded billions more in stock from their boards, Musk lays it all out there. In a post extraordinary for its bluntness, Musk on Monday said on X he was “uncomfortable growing Tesla to be a leader in AI & robotics without having [about] 25% voting control.” Right now, Musk has about 13% of Tesla’s stock and, assuming the Delaware court lets his 2018 compensation plan stand, he has stock options that once exercised would bump him up to 20.6%, according to securities filings. 

Musk could at least have waited until the court ruled before asking for more stock. After all, if the court lets the 2018 plan stand, then the board likely would be looking to award him a bunch of new options anyway, as he’s already passed the milestones from the 2018 plan and all the options have vested. If the court invalidates the plan—and it’s been pondering a decision for  quite a while now—Musk’s post has complicated the board’s ability to give him what he wants. Remember, one of the allegations in the case before the court is that “Musk and his loyalists outlined the fundamental contours” of what he wanted from the 2018 compensation plan before the board’s compensation committee got involved. You could easily imagine a shareholder bringing another lawsuit citing Monday’s post!