Tesla Stock Takes Off as Musk Says His $56B Pay Deal Will Be Approved

Tesla (TSLA) shares jumped Thursday after Chief Executive Officer (CEO) Elon Musk announced that indications are his controversial $55.8 billion pay package will be approved when the votes from today’s shareholder meeting are tallied. 

Musk wrote Wednesday night on X that both the compensation deal, plus a second resolution on moving the electric vehicle (EV) maker’s incorporation from Delaware to Texas, were on their way to passing “by wide margins.”

Musk’s Pay Package Had Been Struck Down by Delaware Judge

Shareholders were asked to again back the plan, which they originally approved in a 2018 vote. However, a Delaware judge threw it out in January, ruling that the payment, the largest in corporate history, was excessive.

Musk’s supporters have argued that the mercurial CEO was the person who made Tesla the huge success it has become. One is Baron Capital founder and CEO Ron Baron, who said in an open letter to other investors that Musk has “earned his pay,” adding that at his firm, “our answer is loud, and unequivocal: Tesla is better with Elon. Tesla is Elon.”

Critics have pointed to Tesla’s slumping stock price, which prior to today had lost almost 29% of its value this year as an overall slowing demand for EVs has hurt sales and led the company to cut prices. Some have complained Musk has focused too much of his attention on his other investments, including X and SpaceX, instead of the carmaker. 

The final results of the votes will be revealed at the shareholder meeting being held at 3:30 PM Central Time at Tesla’s Austin, Texas, headquarters.

Tesla shares surged 7.7% to $190.85 as of 10:09 a.m. ET Thursday.