Tesla grants Musk shares worth $29 billion

Tesla's stock grant to Elon Musk raises concerns amid dwindling profits and political controversies.

Tesla rewards Musk with stock grant worth $29 billion

Tesla awarded Elon Musk a stock grant valued at $29 billion, aiming to retain him as CEO despite recent controversies affecting the company. This grant consists of 96 million restricted shares and comes after Musk's previous compensation package was revoked by a Delaware court. The electric vehicle maker noted Musk's leadership across several ventures, including SpaceX and xAI, and cited the significant increase in Tesla's market value. However, the company has faced challenges, with a 25% drop in shares this year due to backlash over Musk's political ties. Profits have also plummeted from $1.39 billion to $409 million in the most recent quarter, raising investor concerns amid fierce competition in the auto industry.

The substantial grant to Musk highlights ongoing tensions within Tesla as financial performance falters against a backdrop of political engagement. Though the company expects this move to stabilize leadership, the recent downturn in profits and share value suggests that shareholder confidence may remain uneasy. Musk’s political affiliations pose a risk, leaving both the company’s reputation and financial trajectory vulnerable. Analysts have expressed mixed feelings, with some believing the grant could alleviate investor concerns but others warn of potential backlash as the pressure to maintain performance grows amidst increasing competition.

Highlights

Tesla must now navigate these challenges while maintaining investor trust and market position.