What's happened
On September 12, 2025, Elon Musk purchased 2.57 million Tesla shares, increasing his stake to nearly 20%, reinforcing his control amid Tesla's worst sales slump in a decade. Tesla's board proposed a $1 trillion CEO pay package tied to ambitious targets including 20 million vehicles, 1 million robotaxis, and 1 million humanoid robots by 2035. Tesla faces rising competition, declining US and Chinese market shares, and shifting focus toward AI and robotics.
What's behind the headline?
Ambitious Pay Package Amid Declining Sales
Tesla's board has proposed an unprecedented $1 trillion pay package for Elon Musk, contingent on highly ambitious targets including increasing Tesla's market cap from about $1 trillion to $8.5 trillion by 2035, delivering 20 million vehicles, and deploying 1 million robotaxis and humanoid robots. This package reflects the board's intent to secure Musk's focus despite his multiple ventures and recent political distractions.
Market Share Erosion and Competitive Pressures
Tesla's US EV market share has fallen from a peak of 80% to 38%, its lowest since 2017, while Chinese sales declined nearly 10% amid fierce competition from local brands like BYD, Xpeng, and Xiaomi. Tesla's aging product lineup and lack of new affordable models have contributed to this decline.
Strategic Pivot to AI and Robotics
Musk is betting Tesla's future on AI and robotics, particularly the Optimus humanoid robot, which he claims will account for 80% of Tesla's future value. However, production targets for robots and robotaxis remain unmet, and the company is in a 'weird transition period' as it shifts focus.
Governance and Succession Planning
The pay package includes a requirement for Musk to develop a CEO succession framework, signaling some board concern about leadership continuity. Yet, Musk has stated he intends to remain CEO for at least five more years.
Implications
The package's scale and conditions underscore Tesla's reliance on Musk's vision but also highlight governance challenges, especially given past legal scrutiny over executive pay. Tesla's ability to meet these ambitious goals amid market headwinds will determine the package's ultimate value and Musk's continued dominance.
What the papers say
Al Jazeera reports Musk's recent purchase of 2.57 million Tesla shares, reinforcing his control as Tesla faces falling EV sales and a $1 trillion pay package proposal. The Guardian highlights Tesla's stock gains following the purchase and Musk's demand for increased voting power. The New York Post calls Musk a 'generational leader' amid Tesla's worst sales drop in a decade and notes the upcoming shareholder vote on the pay package. Business Insider UK details Tesla's US market share decline to 38%, the lowest since 2017, and the challenges from competitors and regulatory changes. TechCrunch analyzes the pay package's ambitious milestones, noting Musk's unmet promises on robotaxis and production targets. Bloomberg critiques Tesla's governance and the board's focus on restoring Musk's compensation amid declining core business performance. South China Morning Post provides insight into Tesla's sales decline in China amid rising competition from local EV makers like BYD and Xiaomi. These sources collectively illustrate a company at a crossroads, balancing Musk's visionary ambitions with tangible market and governance challenges.
How we got here
Elon Musk joined Tesla in 2004 and has grown his stake and control over the company. Tesla's sales have declined recently due to increased competition and regulatory changes. Musk's previous $56 billion pay package was struck down by a Delaware court, prompting Tesla to relocate to Texas and propose a new $1 trillion compensation plan with performance milestones over 10 years.
Go deeper
- What are the key milestones in Musk's $1 trillion pay package?
- How is Tesla's market share changing in the US and China?
- What challenges does Tesla face in shifting to AI and robotics?
Common question
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What Does Tesla's New Master Plan Really Mean for the Future?
Tesla's latest master plan has sparked curiosity with its broad ambitions and vague promises. While the company emphasizes AI and robotics, many questions remain about what this means for consumers, investors, and the autonomous vehicle industry. Below, we explore the key goals, criticisms, and what to expect from Tesla's evolving strategy.
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What’s the future of Elon Musk’s compensation and Tesla’s growth targets?
Elon Musk’s new compensation plan for Tesla has sparked widespread interest and speculation. With potential earnings exceeding a trillion dollars if certain milestones are met, many are wondering what this means for Tesla’s future. Will Musk’s goals for vehicle and robot sales be achieved? Can Tesla reach an $8.5 trillion market cap by 2035? And how does Musk’s pay plan tie into Tesla’s advancements in AI and autonomous driving? Below, we explore these questions and more to understand what’s next for Tesla and Elon Musk.
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What Are the Broader Implications of Today’s Major News Stories?
Today’s headlines cover a wide range of topics, from Tesla’s ambitious plans to protests in Indonesia, UK retail data, and legal battles over sanctuary policies. These stories reflect deeper trends in technology, politics, and economics that could impact your daily life and investments. Curious about how these events connect and what they mean for the future? Keep reading for insights into the bigger picture behind today’s news.
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How Will Tesla's New Compensation Plan Impact Its Future and Market Value?
Tesla's latest ambitious compensation plan for Elon Musk could be a game-changer, tying his pay to milestones like reaching an $8.5 trillion market cap and boosting AI and robot development. But what does this mean for Tesla's growth, stock performance, and the tech industry? Below, we explore the key questions surrounding Tesla's bold plans and their potential impact on markets and innovation.
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What does Tesla's new AI-focused pay plan mean for Elon Musk and the future of tech?
Tesla has unveiled a groundbreaking 10-year compensation plan for Elon Musk, tying his wealth to ambitious AI, robotics, and automation milestones. This shift signals a major change in Tesla's strategic focus and raises questions about the company's future direction. How will this new plan influence Tesla's innovation, stock performance, and Musk's leadership? Below, we explore the key details and implications of this bold move.
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What does Tesla's shift to AI and automation mean for the future of transportation?
Tesla is increasingly focusing on AI, robotics, and automation, shifting away from traditional electric vehicle goals. This new direction raises questions about how Tesla's plans will impact the auto industry, consumer choices, and the company's competitiveness. Below, we explore what Tesla's AI focus means for the future of transportation and what you should watch for next.
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Why Is Tesla's Market Share Falling in 2025?
Tesla once dominated the electric vehicle market, but in 2025, its share has dropped significantly. Many wonder what's behind this decline and what it means for Tesla's future. Is increased competition, regulatory hurdles, or internal challenges to blame? Below, we explore the key factors impacting Tesla's market position and what lies ahead for the EV giant.
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Why Is Tesla's Market Share Declining in 2025?
Tesla has long been a leader in the electric vehicle market, but recent trends show its market share is shrinking in 2025. This raises questions about what's causing the decline and what it means for Tesla's future. Are rising competitors, political issues, or new vehicle launches to blame? Below, we explore the key factors impacting Tesla's position and what to expect moving forward.
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How Are Global Events Impacting Economic and Political Stability?
In today's interconnected world, events happening across the globe can have far-reaching effects on economies and political landscapes. From market shifts to protests and leadership changes, understanding these dynamics helps us grasp the bigger picture. Below, we explore key questions about how current global events are shaping stability worldwide.
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