The Tesla board has answered that nagging question: What do you get the world’s richest man? 

On the face of it, the answer is more money and control, in the form of the first $1 trillion pay package. In reality, the board is asking shareholders to approve a 10-year compensation plan that is loaded with what really motivates Musk: a ludicrous challenge.

To fully unlock his deal, Tesla would need to reach a market value two times the size of the world’s currently most-valuable company, Nvidia, a point noted in a proxy to investors Friday.

Musk would also have to dramatically reshape Tesla from the company it is today, transforming it into one focused on robotics rather than energy.

In that sense, the pay package is more than a comp plan. It is a road map to where Tesla under Musk wants to go for the next decade with incentives to reach increasingly harder and harder heights.

The payouts are structured in a way that Musk unlocks shares worth 1% of the company in 12 steps. Each milestone is a combination of market-value targets and operational goals, including growing adjusted earnings dramatically.

If he doesn’t achieve the goals, he gets nothing. If he achieves everything, he would receive in total an additional 12% of a company then valued at $8.5 trillion.

Currently, Tesla is worth $1 trillion. That was a remarkable feat when it initially crossed that threshold in 2021, the first and only automaker to do so. 

Then investors were betting on an electric-car future and Musk was talking about producing 20 million vehicles a year—almost twice as many as the largest carmaker was rolling out at the time.

Friday’s plan makes it clear—if it wasn’t already so—that Musk’s ambitions have waned from building cars for people to drive. His new goals aim for a total of 20 million vehicles delivered since the company began more than two decades ago.

As of this summer, Tesla had delivered a total of 8 million vehicles. Analysts expect the company to deliver 1.6 million vehicles this year, down from last year amid pressure from rivals catching up with their own EVs. The Tesla brand also has struggled because of Musk’s contentious swing into politics.

Among the dozen operational milestones Musk would need to achieve to fully earn 423.7 million shares, Tesla must deliver one million robots, one million robotaxis and 10 million subscriptions to the company’s advanced-driving system called FSD. 

The kinds of humanoid robots Musk is proposing seem straight from sci-fi. 

The proxy tries to put that into today’s language, using a generic term of “bots.” It says this means “any robot or other physical product with mobility using artificial intelligence manufactured by or on behalf of the company.” This could include Optimus, the humanoid robot seen at Tesla stores in malls around the U.S., or whatever comes next. It doesn’t include vehicles. 

In a recent report, the International Federation of Robotics estimates around 540,000 robots were installed in industrial settings in 2023. More than 4 million were in use globally. 

If all of this seems wild-eyed and unlikely, then you don’t know what fuels Musk. Even the Tesla board calls the goals aspirational, describing them in documents as “Mars-shot (not merely Moon-shot) milestones.”

It’s crafted to make Musk happy. 

He has been vocal for some time about his desire to have a bigger ownership stake in Tesla. Unlike other tech entrepreneurs of his generation, Musk doesn’t have a special class of ownership stake that allows him to control the company like Mark Zuckerberg does at Meta Platforms.

He now controls about 20% and has said he worries about the threat of activist investors, especially if he is focused on developing world-changing AI that could be used for ill-intent.

But more than just making him happy, the board has worked to try to ensure Musk sticks around for years to come. He will earn the voting rights associated with the restricted common stock as soon as he meets the milestones, but must remain in service for a vesting period of 7.5 to 10 years.

Many investors think there’s an Elon premium in the stock. Or, put another way, the company’s value might plunge if he left because investors doubt another CEO could pull off the vision he has sold. (Some critics doubt that even Musk can do it.)

Musk’s previous compensation plan, first approved by shareholders in 2018, was full of its own unprecedented superlatives and greeted by doubters. He was tasked with taking Tesla from a market value of around $60 billion to $650 billion in a decade’s time. He achieved that years early.

Yet the payout—valued these days at around $50 billion—has been tied up in legal challenges. A Delaware judge has struck down the package while Tesla is appealing. This time around, the board is confident recent changes in Delaware law have paved the way for the newest package.

Since achieving the goals of the 2018 plan, Musk has seemed adrift at Tesla. 

First, he appeared consumed with the acquisition of Twitter-turned-X in 2022 and the challenge then to stabilize the troubled social-media company. Last summer, he jumped into the deep end of presidential politics, endorsing President Trump, pouring millions of dollars into supporting Republicans and even taking to the campaign trail.

Earlier this year the board urged him to spend more time on Tesla. Now, they’re offering up the carrot to do so. 

“We believe that Elon’s singular vision is vital to navigating this critical inflection point,” Robyn Denholm, Tesla’s chair, told investors in a letter. “We also recognize the formidable nature of this undertaking and as a result, the importance of having a leader who is not only willing and capable but eager to meet this challenge.”

Eager being the key word.