Tesla Chief Executive Elon Musk this week offered a personal tour of the electric car maker’s factory in Austin, Texas, to some shareholders.
“Please let us know if you have any questions about voting your Tesla shares! » Mr. Musk wrote on X, the social media platform he owns.
This is just one of several posts Mr. Musk has published on X in recent weeks, as Tesla shareholders voted on a $46.5 billion compensation package for him.
To encourage approval of the package, Mr. Musk shared on X a sizzling reel of Tesla vehicles driving through deserts at dusk. He said he needs enough stock in the company to maintain control, especially as it ramps up its artificial intelligence efforts. And he took aim at investors who said they would oppose his salary.
“Thank you to all supporters of the Tesla vote! ” Mr. Musk wrote in a post on May 16, followed two days later by: “Shareholders have the right to vote their shares! On Thursday, he said shareholders who voted against him were “oath breakers.”
The posts on The judge ruled in favor of a dissident shareholder who sued Tesla, saying Mr. Musk’s compensation was excessive.
Now, Tesla is campaigning for shareholders to once again approve Mr. Musk’s salary, which helped make the company the world’s most valuable automaker. Tesla also posted messages on his behalf, and the company’s board publicly supported Mr. Musk’s campaign, saying his performance deserved compensation.
Mr. Musk turned to his platform of choice, X, to make his point. This is part of his tendency to increasingly use X for the benefit of his other businesses. In some cases, he displayed support for right-wing state leaders, who then helped secure benefits for Tesla, including lower tariffs and access to important materials. He also uses the site to market milestones at SpaceX, his rocket company, and the introduction of new vehicles at Tesla to his 185 million subscribers.
Mr. Musk’s use of X is “both a blessing and a curse,” said Eric Talley, a professor at Columbia Law School. “X is a good way to rally the troops.” But, he added, “you want to have a lawyer who makes sure he doesn’t mess up his own case.”
Mr. Musk’s posts on But threats like the one he issued in January about pursuing robotics and artificial intelligence companies outside of Tesla unless he gets 25% of the company’s voting shares could be problematic, they added.
In response to a request for comment, a representative of Tesla’s board referred to a post in which Mr. Musk said he did not need the money but wanted enough control to ensure that the Artificial intelligence was managed responsibly. Mr Musk did not respond to a request for comment and X declined to comment.
Tesla Board Chairwoman Robyn Denholm posted a message on a company-backed website advocating for her pay package. “Elon has generated the type of growth that most thought was impossible, and he has created tremendous value for you, the owners of the company,” she wrote.
Tesla shareholders first voted on Mr. Musk’s pay package in 2018, approving a plan to give him an additional 12% stake in the company over a dozen years and making him the leader the highest paid in the country. Tesla was valued at $560.2 billion as of Thursday’s market close, and Mr. Musk controls 20.5 percent, according to Securities and Exchange Commission filings. (This figure includes shares that were voided by the Delaware court and which Tesla is seeking to restore. Without those, its stake is about 13%.)
Mr. Musk does not receive any salary from Tesla. To earn the company’s stock payments, he had to achieve ambitious growth milestones within the company.
But Kathaleen McCormick, a Delaware Chancery Court judge overseeing the dissident shareholders’ lawsuit, struck down the pay package, ruling that Mr. Musk had near-total control over Tesla’s board and essentially approved his own compensation without proper fiduciary management . The judge also ordered him to return his excess salary to Tesla.
In April, Tesla asked shareholders to reapprove Mr. Musk’s pay plan. The result will be announced at the company’s annual meeting on June 13.
Mr. Musk often posts about Tesla on X, in part because the automaker avoids more traditional marketing. He usually hosts spectacular online events for the company’s first vehicles or humanoid robots.
Some of his Tesla posts on X got him into trouble. In 2018, the SEC fined Mr. Musk $20 million for claiming on the platform, then known as Twitter, that he planned to take Tesla private at a price of $420 per share. (Tesla paid a separate $20 million fine.) That price, for which it said it “secured financing,” was 20% higher than what Tesla stock was trading at at the time. Regulators later said he misled investors.
As part of his settlement with the SEC in 2018 for the job, Mr. Musk was required to turn over his social media posts to a company lawyer if the statements contained material information about Tesla. He also resigned as chairman of Tesla’s board of directors.
Mr. Musk later tried to back out of the deal, saying it infringed on his freedom of speech. But in 2022, a federal court rejected the request. Mr. Musk appealed to the Supreme Court, which in April declined to hear the case.
The SEC declined to comment on Mr. Musk’s public campaign for his salary.
It is unclear whether the salary package will be adopted. Some institutional investment firms, such as Nordea Asset Management, have spoken out against the pay package in recent weeks. Tesla shares have fallen about 28% this year and the company is behind schedule in releasing new models. Tesla has also lost customers to electric car makers in China.
“Even if Tesla’s performance fails, the Board has yet to ensure that Tesla has a full-time CEO who is adequately focused on the long-term sustainable success of our company,” wrote a group of institutional investors to shareholders this month. Among the investor representatives was New York City Comptroller Brad Lander, who oversees the city’s pension fund.
Glass Lewis, a proxy advisory firm that consults with institutional investors on how to vote their shares, this week recommended that Tesla shareholders reject Mr. Musk’s plan. The company said its already large stake in Tesla gave it incentive to perform well and that giving it more shares would dilute the stake of other shareholders.
Glass Lewis’ views have influence with major asset managers, which in Tesla’s case include Vanguard and BlackRock. CalPERS, California’s pension fund, also said it would vote against the compensation program.
“Shame on them, they have no honor,” Mr. Musk responded on Wednesday.
The chances of the pay measure passing took another blow Friday when Institutional Shareholder Services, which also advises institutional investors, recommended against approval.
Even if Tesla shareholders vote to reinstate Mr. Musk’s salary, they are unlikely to have the final say, legal experts said. The Delaware judge will still have to decide whether the vote is enough to restore his salary, and the decision will likely be appealed.
To survive legal challenges, the compensation plan must be approved by investors representing more than 50% of the voting shares not owned by Mr. Musk or his brother, Kimbal Musk.
Paul Regan, an associate professor at Delaware Law School, said of Tesla’s board: “This thing might end up not going the way they think it will.”