The Tesla (TSLA) board has approved a pay package for CEO Elon Musk worth up to $1 trillion. But there’s a catch: Musk only gets the full payout if Tesla’s market cap hits $8.5 trillion within 10 years.
For context, that’s roughly double the size of NVIDIA (NVDA), which is currently the world’s most valuable company at $4.3 trillion.
Tesla’s market cap today sits around $1.2 trillion. Hitting $8.5T implies a Tesla stock price north of $2,100 per share (up from the high $300s today).
Bullish or Concerning?
In a recent episode of Market on Close, John Rowland, CMT, agreed that the proposal could be viewed as bullish for shareholders.
Why?
- It ties Musk’s rewards directly to shareholder value.
- It ensures long-term commitment — the vesting period stretches 10 years.
- It motivates aggressive growth targets in a highly competitive electric vehicle (EV) and artificial intelligence (AI) landscape.
That said, a trillion-dollar payday raises questions:
- Is $8.5T realistic given Tesla’s fundamentals?
- Would passive funds be forced to allocate heavily to Tesla if it reached that size?
- Could this spark a speculative trading frenzy?
The Math Behind $8.5T
If Tesla grows to $8.5 trillion, its valuation would:
- Surpass the combined GDP of Japan and Germany.
- Put it on par with the total value of today’s top three U.S. mega-caps combined.
- Require massive growth in EV adoption, energy storage, and AI/robotics revenue streams.
It’s ambitious… but ambition has always been Musk’s brand.
Bottom Line
Whether you view it as audacious or absurd, Elon Musk’s proposed $1 trillion payday is another reminder: Tesla is one of the market’s most ambitious — and polarizing — stories.
Watch the clip from Market on Close where John Rowland and cohost “Twitter Tom” react to the news:
Stream the full episode to catch the broader discussion, and drop a comment to tell us: Is Elon Musk worth $1 trillion if he delivers $8.5 trillion in value?
