Elon Musk’s $1 trillion pay deal has been approved by Tesla shareholders.

Tesla boss Elon Musk has received a record pay package worth almost $1 trillion (£760 billion) approved by shareholders.

The unprecedented deal was approved by 75% of votes and received loud applause from the audience at the company’s annual general meeting held on Thursday.

Musk, who is already the world’s richest man, must significantly increase the market value of his electric car company over the next 10 years. If he does this and achieves various goals, he will be rewarded with hundreds of millions of new shares.

The size of the potential payout has drawn criticism, but Tesla’s board has insisted that Musk could leave the company if he is not approved and they cannot afford to lose him.

After the announcement, Musk took the stage in Austin, Texas and danced to a song shouting his name.

“What we’re launching isn’t just a new chapter in Tesla’s future, it’s a whole new book,” he said.

“Other shareholder meetings are snoozefests, but ours is dangerous. Look at this. This is disgusting,” he added.

Here are the milestones Musk needs to achieve over the next 10 years:

• Tesla delivers 20 million vehicles and 1 million robots
• Tesla’s fully self-driving feature reaches 10 million subscribers
• 1 million self-driving Robotaxi vehicles put into commercial operation
• Earn up to $400 billion in core profits
• Eventually, Tesla’s overall market value would rise to $8.5 trillion (currently $1.4 trillion).

He will not be paid under the agreed deal.

However, if he achieves all of the above goals, he will receive a stock grant of more than 400 million shares of Tesla stock, worth about $1 trillion, if the company’s market value rises high enough.

Musk’s initial comments on Thursday drew attention to the Optimus robot and dashed the hopes of some longtime analysts and Tesla watchers who wanted him to focus on reviving the company’s electric vehicle business.

Optimus, which the company unveiled as a prototype in 2022, was designed as an “autonomous humanoid robot” that performs “unsafe, repetitive or tedious tasks.”

Musk has made it central to the company’s future, using the same artificial intelligence (AI) system that powers Tesla vehicles.

He has previously said that the robot’s ability to walk, run and lift objects will play an important role in factories and, in the future, in the home.

“Let Musk’s head sink where it belongs,” analyst Gene Munster, managing partner at Deepwater Asset Management, wrote of X.

“His ‘new book’ vision starts with Optimus. No word yet on cars, FSD or robotaxi.”

Musk later referenced FSD, shorthand for fully autonomous driving, saying the company was “almost comfortable” allowing drivers to “essentially text and drive.”

U.S. regulators are investigating Tesla’s self-driving capabilities after a number of incidents in which cars ran red lights or drove on the wrong side of the road, leading to some accidents and injuries.

Tesla shares rose slightly in after-hours trading but are up more than 62% over the past six months.

Sales have fallen this year since Musk collaborated with U.S. President Donald Trump. This relationship broke down last spring.

Tesla shareholder Ross Gerber told BBC News that Musk’s pay deal was “another step up in the unbelievable things we’re seeing in the business.”

Musk has made his goals for Tesla clear, but the company faces numerous challenges, including poor financial performance, said Gerber, CEO of investment firm Gerber Kawasaki.

Mr. Gerber said it is not yet clear whether there will be much demand for humanoid robots. Tesla also faces stiff competition from rivals such as Waymo in the robotaxi industry, he added.

Mr. Gerber said his company had recently lowered its stake in Tesla due to concerns about “polarizing (Musk’s) persona” that had “destroyed the value of the brand.”

“Elon seems out of touch with the reality that his opinion among the public is so low,” he said.

Dan Ives of Wedbush Securities, a technology analyst who has long defended Musk’s leadership of Tesla, called him “Tesla’s greatest asset” in a note released after the vote.

“We continue to believe AI valuations are unraveling, and we believe the march toward AI-centric valuations for TSLA over the next six to nine months has now begun,” Ives added.

Anne Lipton, a law professor at the University of Colorado, said it was unclear whether Musk would achieve the goals the company had set, but highlighted how he “achieved these milestones ahead of schedule” in 2018.

She said that while his political interests had caused some ‘polarization’, his pay package ‘did not place any restrictions on his activities’ outside the company.

Musk already owns 13% of Tesla stock. Shareholders twice ratified pay packages worth tens of billions of dollars when the company’s market value increased tenfold, which he did.

But a Delaware judge rejected the pay deal because Tesla board members were too close to Musk.

Tesla was reincorporated from Delaware to Texas, and the Delaware Supreme Court is currently reviewing the lower court judge’s decision.

Several major institutional investors have rejected the new pay package, including Norway’s Sovereign Wealth Fund, the world’s largest sovereign wealth fund, and the California Public Employees’ Retirement System (CalPERS), the largest public pension fund in the United States.

This has made Musk more dependent on Tesla’s unusually large group of individual investors.

Musk and his brother Kimball, who is also a Tesla board member, were able to vote while attending Thursday’s meeting.

In recent weeks, Tesla board members have helped lobby for Musk’s new pay package with a marketing blitz that has angered some corporate governance experts.

A video posted to votetesla.com shows Board Chair Robyn Denholm and Director Kathleen Wilson-Thompson praising Musk.

Kathryn Hannon, investment manager at RBC Brewin Dolphin, said the new pay deal would “give him increased voting rights in the company,” something Musk has long demanded for years.

“Elon Musk is the visionary for this space, whether you like him or not, and putting the right governance and incentive structures in place around him to deliver that will hopefully align with shareholders on the journey to success.”