Tesla Grants Elon Musk $29 Billion in Shares to Secure Future Amid AI Race

Tesla has approved a new $29 billion share award for CEO Elon Musk in a bid to retain the billionaire tech mogul as competition for AI talent heats up globally.

The decision follows a legal blow earlier this year when a Delaware court voided Musk’s previous $56 billion compensation package from 2018, calling it “unfair to shareholders.” Musk is currently appealing that ruling.

In a letter to shareholders on Monday, Tesla’s board reaffirmed its confidence in Musk’s leadership, stating the new award is essential to keep him focused on the company’s future. “No one matches Elon’s remarkable combination of leadership and technical expertise,” the board said. They also noted that the firm is at a critical “inflection point” as it evolves from a carmaker into a broader AI and robotics company.

The company clarified that if the court reinstates the 2018 deal, Musk would either forfeit or return this latest grant to avoid any overlap in compensation.

This fresh equity incentive is expected to further strengthen Musk’s influence at Tesla by increasing his voting power, a move the board believes is necessary to “retain and motivate our extraordinary talent, beginning with Elon.”

Musk’s previous pay deal was milestone-based—he would only earn the payout if Tesla met specific performance targets. According to the company, all targets were met under his leadership.

Industry analyst Dan Ives of Wedbush Securities described the move as vital: “This is what Tesla needed to do to ensure Musk remains fully committed, especially during the ongoing AI arms race.”

Tesla joins other tech giants in aggressively competing for top AI talent. Companies like Meta and Microsoft have recently made high-profile hires and offered multi-million-dollar packages to engineers in the space. Tesla’s board made it clear that retaining Musk is part of that same strategic battle.

Alongside Tesla, Musk is involved in several ventures including xAI, Neuralink, and The Boring Company. The board acknowledged that competing demands on his time could pull him in different directions, making the new stock award a timely incentive.

Tesla officially framed the award as an effort to secure Musk’s focus during a pivotal chapter in the company’s transformation.