Tesla awards boss Elon Musk $29bn in shares

Tesla has granted its chief executive Elon Musk $29bn (£21.7bn) worth of its shares, in an attempt to keep the billionaire at the firm.

The move comes after a US court struck down his 2018 pay package, worth more than $50bn, ruling that it was "unfair to shareholders".

Musk has been appealing against the decision made by the Delaware court in 2024 and on Monday Tesla told shareholders it was "confident" that the $29bn of shares "will incentivize Elon to remain at Tesla" especially as "the war for AI talent is intensifying".

The award should boost Musks voting power on the electric car companys board.

"It is imperative to retain and motivate our extraordinary talent, beginning with Elon", Teslas board wrote on X, a platform owned by Musk, adding that "no one matches Elons remarkable combination of leadership experience, technical expertise".

The company said the billionaire had a "proven track record" in building "revolutionary and profitable businesses".

Tesla said if the Delware court reinstated Musks 2018 pay deal, he would forfeit or return the latest share award to avoid a "double dip".

The carmakers board said it hoped its chief executive could be awarded the deal worth $56bn, which would be the biggest pay deal in corporate American history.

The deal was structured in such a way that if Mr Musk did not hit certain milestones – such as Teslas market value, sales and underlying profit – he would not get paid at all.

But he achieved the targets that were laid out.

Musks appeal to get his pay packet reinstated argues that the lower court made legal errors when rescinding his pay package. He has previously said that it should be company shareholders who decide pay.

Dan Ives from Wedbush Securities told the BBC Teslas move was "what they need to do to keep him [Musk] at the firm".

"The biggest asset for Tesla is Musk, the board need to do this, and I believe its a huge step forward."

He added that during the "AI arms race", the firm could not afford to have Musk only "semi-committed".

Tech firms trying to assert themselves in the AI sector have been offering huge sums to workers at rivals in an effort to persuade them to join them and boost their development.

Facebook founder Mark Zuckerberg was said to have recently tried to lure top developers from ChatGPT-creator OpenAI with million-dollar pay deals.

Meanwhile Microsofts AI division, headed up by former Google DeepMind co-founder Mustafa Suleyman, recently gained several new hires from Googles ranks.

Tesla said it was at an "inflection point" and needed Musks prowess as it pivots from being an electric vehicle firm to an AI and robotics-focused company.

The company added the share award would be attractive for Musk "with other "demands on his time and attention".

Musks other roles include executive positions at xAI, Neuralink, and The Boring Company, which makes tunnels and other infrastructure in the US.

He recently announced that he was stepping back from politics, after a stint as US President Donald Trumps adviser.

Additional reporting by Liv McMahon.