Elon Musk could become the world’s first trillionaire under a new proposed payment package at Tesla – if the chief executive hits a series of ambitious targets across the next decade.

Already the world’s richest man with a net worth of $378bn (£280bn), the South African-born entrepreneur could be handed a deal worth more than $1 trillion (£740bn) if shareholders vote through board proposals.

Based on current market capitalisation values, it would make Mr Musk worth more than all but the six or seven biggest public companies on the planet.

Achieving the terms of the deal would almost certainly make Tesla the biggest business in the world, as one of the terms included is to grow the company’s market value to $8.5 trillion (£6.3 trillion) from the $1.1 trillion figure it stands at today. Chipmaker Nvidia is presently the only firm bigger than $4 trillion.

The new incentive plan from Tesla was shown in a filing to the US Securities and Exchange Commission on Friday. In it, Mr Musk could increase his stake in the company to at least 25 per cent.

“We are laying the foundation for our next decade of growth by rolling out our ambitious vision and securing our leadership to deliver against that vision,” read part of the filing, later adding: “Retaining and incentivising Elon is fundamental to Tesla achieving these goals and becoming the most valuable company in history.”

Tesla’s filing goes on to suggest he could also have a say in his eventual successor as CEO: “While we believe Elon is the only person capable of leading Tesla at this critical inflection point, changing the world is neither an overnight process nor the work of a single person.”

The company’s share price, which rose 2.5 per cent in pre-market trading after the filing was announced, is down 16 per cent across 2025 as a whole as the EV maker struggles with industry competition, pricing and brand image.

However, in future it expects to generate far more revenue through AI and other product avenues – the progression of which is linked to Mr Musk’s prospective pay package, such as getting 1 million robotaxis on the road and 1 million AI humanoid robots in production.

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The shares would be dealt out in tranches according to milestones being hit, including the company’s financials.

Not everyone is immediately convinced however, with some market analysts questioning the likelihood of reaching the targets – as well as whether Tesla’s performance under Mr Musk of late suggests he should even be the one to steer the company into that future.

“One minute Tesla’s board is wondering if Elon Musk is a liability to the company given his outspoken views and political distractions, the next they’re effectively saying ‘pick a number, any number’ to lock him in for as long as possible,” said Dan Coatsworth, investment analyst at AJ Bell.

“A $1 trillion pay package beggars belief. Is one person worth that much? Musk is a visionary, has endless energy, and the confidence to succeed – all qualities required in leadership.

“But he also presides over a company that has lost its edge, is being overtaken by rivals, and whose brand has been tarnished by Musk’s actions outside of Tesla. Surely Musk should be fighting for his job, not Tesla’s board fighting to keep him?

“Tesla is a public company, and shareholders will ultimately decide if he deserves a $1 trillion pay deal.

“The bigger question is whether this proposal sets a new precedent and boardrooms across America will think it’s OK to add a zero or two onto the end of current remuneration packages. It all seems a tad excessive and a symptom of poor corporate governance.”

Very early in the new pay plan, Tesla would have to reach a market valuation of $2 trillion (£1.48 trillion) and achieve 20 million vehicle deliveries. Tesla delivered fewer than two million vehicles in 2024.

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Mr Musk needs to remain with Tesla for at least seven and a half years to cash out on any stock, and 10 years to earn the full amount.

He would also receive more voting power over Tesla under the proposed plan.

The EV company is set to hold its annual shareholders meeting on 6 November.

Sales have fallen precipitously in Europe and plunged 40 per cent in July in the 27 European Union countries compared with the year earlier, even as sales overall of electric vehicles soared, according to the European Automobile Manufacturers’ Association.

Meanwhile, sales of Chinese rival BYD continued to climb fast, grabbing 1.1 per cent market share of all car sales in the month versus Tesla’s 0.7 per cent.

Investors have grown increasingly worried about the trajectory of the company after Mr Musk had spent so much time in Washington this year, becoming one of the most prominent officials in the Trump administration in its bid to slash the size of the US government.

Mr Musk said recently that he needed more shares and control so he could not be ousted by shareholder activists.

Additional reporting by Associated Press