In fact, Tesla’s CEO Elon Musk has Tesla’s head in the prize. He’s targeting an $8.5 trillion market cap for the EV maker. This ambitious target will be necessary for him to unlock the full value of his highly-paid compensation package. The deepening will be signed after shareholders approve it at a special meeting later this November. Now that he has settled in at Twitter, Musk needs a succession plan — but not for himself. This provision locks him in to Tesla for at least the next 7.5 years.
Musk’s strategic vision includes not only reaching this staggering valuation but achieving a significant production milestone for Tesla’s vehicles. Just a year ago, he claimed that Tesla would be building at least 20 million electric vehicles per year by 2030. He has since changed this goal to provide a cumulative total of 20 million vehicles by 2035. On the other hand, Musk has stated that he wants to manufacture one million humanoid robots—named Optimus—annually by 2029.
The Path to Valuation and Production Goals
Much of Musk’s ambitions rest on a set of highly ambitious production targets squeezing out a vision for Tesla both in the short-term and long-term. The company has been the talk of the town for most of 2023 with its buzzworthy new approaches. By focusing on electric vehicles and robotic manufacturing, Musk is convinced that he can make Tesla “the most valuable company in human history.”
During these challenging economic times, the board of directors remains upbeat on this forecast. In fact, they think Tesla might one day be worth more than $15 trillion—more than the total value of the next five most-valuable companies combined. Realizing such a valuation would take historic changes in supply and market conditions.
“The most valuable company in history.” – Tesla’s board of directors
To achieve these massively ambitious production targets, Musk plans to exploit the power of technology and artificial intelligence. He has often stated that Tesla vehicles are fully upgradable to complete autonomy. All it would take is for them to do a software update! He only recently admitted that most cars on the road today lack the required hardware. Without this additional hardware, they cannot reach Level 4 or 5 full autonomous driving capabilities.
Even with those global toast points, Musk is bullish on what’s to come. The extended timeline gives him more wiggle room as he tries to fulfill both his robotaxi and Optimus bot ambitions.
The Role of Optimus in Tesla’s Future
As for the impact of Optimus Musk’s master plan has long been to evolve Tesla beyond an automaker. He has described the humanoid robot as “the clearest example of how Tesla has the ability to make autonomy benefit all of humanity.” This notion underscores the notion that the breakthroughs in robotics would dramatically reshape Tesla’s portfolio. At the same time, they must deliver strong benefits to the economy and society at large.
Musk envisions cranking out a million Optimus bots annually by 2029. Most other people think that he’s crazy, but he believes these robots are going to be Tesla’s best-selling product. That ambitious production target goes to the heart of his broader strategy. His stated goal is for Tesla to be the world’s most compelling maker of initiation – electric vehicles and robotics.
“The clearest example of how Tesla has the ability to make autonomy benefit all of humanity.” – Tesla’s board of directors
This robotic initiative is more than an attempt to grow Tesla’s automotive business. More importantly, it marks a historic inflection point on the path toward integrating robotics into our everyday life. The potential ramifications of technology like this would be immense, across nearly all sectors and services, creating savings and improving productivity.
Shareholder Approval and Succession Planning
Musk’s astronomical compensation package is subject to shareholder approval at his company’s annual meeting set for November. By doing so, this package acts as more than a financial incentive but links Musk’s future with Tesla in a significant manner. This makes sense because the company now forces him to come up with a succession plan. This move cements stability and continuity in leadership for the next few years.
So it was with the Delaware Chancery Court’s recent, close examination of Musk’s award. This raises critical questions about the accountability, transparency and necessity of lavish compensation packages. This backdrop makes winning approvals even more daunting.
