Tesla stock drops over 2% amid investor concerns
Tesla shares slipped more than 2% in early trading Thursday as investors awaited the company’s most significant shareholder meeting in years. The stock was trading around $452, down from Wednesday’s close of $462.07 — just the seventh time it had finished above $460 — and remained close to its all-time closing high of $479.86 set in December 2024.
Over the last three months, Tesla’s stock has climbed 44%, driven by growing optimism around its artificial intelligence and robotics initiatives. The upcoming annual shareholder meeting in Austin, Texas, is expected to play a defining role in Tesla’s long-term direction.
Focus on Musk’s record-breaking pay proposal
Among the key items on the agenda is a proposal to approve CEO Elon Musk’s $1 trillion compensation package, described as the largest executive pay plan in corporate history. The plan links Musk’s compensation to ambitious performance goals spanning production, technology, and market valuation.
To unlock the full payout, Tesla would need to produce 20 million vehicles within ten years, deploy one million robotaxis, and increase its market capitalization from the current $1.5 trillion to as much as $8.5 trillion.
Supporters say such targets reflect Musk’s bold vision and, if met, could yield tremendous value for shareholders. Critics, including Norway’s sovereign wealth fund and major proxy advisory groups, argue the plan is excessive and misaligned with traditional compensation standards.
Shareholder vote to shape Tesla’s direction
The outcome of Thursday’s vote could significantly influence Tesla’s strategic priorities, investor sentiment, and Musk’s control over the company. Many market observers view this meeting as a key moment in determining how Tesla balances innovation, governance, and executive incentive structures moving forward.
Author’s summary: Tesla’s 2% stock drop reflects growing tension around Elon Musk’s unprecedented $1 trillion pay plan as shareholders prepare to decide its fate in Austin.