Electric vehicle manufacturer Rivian Automotive, Inc. (NASDAQ:RIVN) announced a significantly revised pay package for its CEO, Robert Scaringe, much like Tesla, Inc.’s (NASDAQ:TSLA) approach to rewarding Elon Musk.
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The new deal could be worth up to $4.6 billion over the next 10 years and incorporates both profit goals and more attainable stock price milestones than the previous plan, according to Reuters.
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The change comes just one day after Tesla shareholders approved a historic $1 trillion pay arrangement for Musk, spotlighting intense interest in executive compensation structures at leading EV firms.
Scaringe's new package includes options for 36.5 million shares at $15.22 each—a roughly 16 million share increase over his last award. For these shares to vest, Rivian must meet share price targets of $40 to $140 over a decade, in addition to meeting new operating income and cash flow objectives through 2032.
Rivian had previously granted Scaringe options tied to much higher share prices ($110 to $295); those were scrapped due to their low likelihood of being achieved.
The current award highlights the company's desire to retain its founder and drive both growth and profitability, particularly as Rivian prepares to roll out the R2 SUV—a new, more affordable model set to challenge Tesla's Model Y.
In addition to the stock options, Rivian's board doubled Scaringe's annual salary to $2 million, ensuring his pay better aligns with shareholder returns, a decision made with guidance from independent consultants.
Moreover, Scaringe received 1 million common units in Mind Robotics, a new Rivian spin-off focused on industrial AI, granting him a potential 10% stake if profit targets are surpassed. Scaringe will lead Mind Robotics as board chairman, with Rivian continuing as a shareholder in the venture.
The tough new milestones mean Scaringe will only benefit if the company delivers substantial value to investors. If all targets are met, the payout could reach up to $4.6 billion—roughly a quarter of Rivian's current market value, and slightly above its $4.4 billion cash balance at September's end.
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