Tesla Chair Defends Elon Musk's Pay Package and His Future at Company

Robyn Denholm, chair of Tesla’s board of directors, discusses the board’s views on Elon Musk’s potential $1 trillion pay package ahead of the company's annual shareholder meeting. Speaking on "Bloomberg Tech," Denholm also comments on Musk's future at the company and the board's shareholder proposals.

Tesla Inc. is prepared to name a new chief executive officer from inside the company if shareholders reject Elon Musk’s proposed $1 trillion pay package and he steps down, according to the chair of the EV maker’s board.

To ensure an “orderly transition, the most likely would be internal,” Robyn Denholm said Tuesday in an interview, without ruling out the possibility of external candidates.

While Musk has been inextricably linked to Tesla for more than a decade, the prospect of his departure has come into focus ahead of the pivotal shareholder vote next week.

The compensation agreement could give Musk a 25% stake if he significantly expands Tesla’s market value and hits growth milestones in its car, robotics and robotaxi businesses. If he doesn’t get his preferred pay package and greater voting control, he’s threatened to quit or shift his attention to xAI, SpaceX and his other business ventures.

“I’ve had the conversations with him directly,” Denholm said at Bloomberg’s office in New York. “There’s no question in my mind that if we don’t get this across, there is a high probability” he would back away from the company or become less engaged.

The comments came in a broader blitz of media interviews and investor meetings to gain support for the unprecedented pay package, which will be voted on at the company’s annual meeting on Nov. 6.

While there’s little indication that the vote will fall short, Denholm said investors often wait until the last minute and the company can’t take anything for granted. With retail shareholders making up about 30% of the investor base, the typically press-shy company felt the need to run a get-out-the-vote campaign.

She and other board members, including James Murdoch and former Chipotle CFO Jack Hartung, have also been meeting with many of Tesla’s largest institutional shareholders, which include Vanguard Group, Blackrock Inc. and State Street Corp. Many investors follow recommendations from proxy advisers like ISS and Glass Lewis, which both advised investors to vote against the package in separate reports.

“There is no guarantee,” she said. “There is a large contingent of passive investors who actually follow their guidance, so we have to counter that with them directly.”

To further drum up support, the company on Monday plopped its Optimus humanoid robot outside the Nasdaq stock exchange in New York, where it passed out company-branded gummy candies to a line of fans and curious onlookers. The machine gave an occasional wave or thumbs-up to passers-by, some of whom took videos or snapped selfies with it.

Tesla shares climbed 2.9% at 12:56 p.m. in New York. The stock rose 12% this year through Monday, trailing the 17% gain in the S&P 500 Index. The performance marked a significant turnaround from earlier in 2025, when concerns over Tesla’s aging vehicle lineup and a consumer backlash to Musk’s political activity sent the stock tumbling.

The episode underscored the importance of Musk’s active engagement with Tesla, something the new compensation package is designed to incentivize. The agreement would help ensure that development around artificial intelligence and other new products happens within the company rather than with one of his multiple other ventures.

If the effort fails, the company said it’s ready with a “Plan B.” Denholm said the company has a deep bench of executives, which include global production chief and China head Tom Zhu, among others. Zhu, for instance, has worked in multiple capacities across the company, an intentional move to develop people internally, Denholm said.

She said there is a “whole range of different alternatives out there,” including having more than one person run the company.

Another matter up for a nonbinding shareholder vote is an investment in xAI, Musk’s artificial intelligence company.

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