Major Tesla shareholder opposes Elon Musk's $56 billion pay package
What specific reasons did Chris Ailman and CalSTRS give for opposing Elon Musk's compensation package?
Chris Ailman, the chief investment officer of the California State Teachers' Retirement System (CalSTRS), opposed Elon Musk's multibillion-dollar pay package for several reasons46. Firstly, he considered the compensation package to be "ridiculous" and "absurd." He suggested that Musk should receive a salary that is 140 times the average worker pay, which he deemed more than fair.
Secondly, Ailman was concerned about Musk's focus on his numerous other pursuits, such as SpaceX and X, and believed that he should allow professional managers to lead Tesla while concentrating on other ventures. Ailman also criticized Musk's board governance at Tesla and his tendency to have "temper tantrums."
Lastly, Ailman argued that Tesla's stock valuation should reflect its status as a car company, stating that its current valuation is not justified even with advanced technologies like AI in their vehicles. Despite these concerns, Ailman expressed his admiration for Musk as a leader and innovator and stated that CalSTRS has no plans to sell its Tesla shares.
How has the value of Elon Musk's compensation package changed since it was first voted on in 2018?
Elon Musk's compensation package was worth $56 billion when it was first voted on in 2018. However, as of June 2024, the value of the package has decreased to about $46 billion due to changes in Tesla's stock price.
What are the implications of Musk's decision to redirect Nvidia chips from Tesla to another project on institutional investors' decisions?
Musk's decision to redirect Nvidia chips from Tesla to X has raised concerns among institutional investors about his focus on Tesla and the company's immediate needs. Some investors, such as the California State Teachers' Retirement System (CalSTRS), have publicly opposed Musk's multibillion-dollar pay package, arguing that it is excessive and that Musk should focus on either Tesla, X, or SpaceX.
The decision to redirect the chips has also led to questions about Musk's dedication to Tesla and whether he is prioritizing his other ventures over the automaker. This has caused some tension between Musk and Tesla shareholders, who are concerned that his attention is divided among too many companies.
The implications of Musk's decision on institutional investors' decisions are mixed. Some investors may see this move as a sign that Musk is not fully committed to Tesla and may choose to divest from the company. Others may view this as a strategic move that aligns with Musk's long-term vision for AI and self-driving technology and may continue to support Tesla.
Ultimately, the outcome of the investor vote on Musk's pay package and the company's future performance will determine how institutional investors perceive Musk's decision and its implications on their investment decisions.