Tesla Hits a Speed Bump While Elon Musk Cashes a $56B Check

Elon Musk’s payday soars as Tesla’s wheels wobble—proof that even when the EV giant stumbles, its CEO lands on a golden parachute.

The Irony of Incentives

While Tesla’s stock dips amid production delays and demand concerns, Musk’s compensation package—approved in 2018—kicks into overdrive. The board tied his pay to market cap milestones, and despite recent turbulence, those targets are now a distant memory.

Shareholders Foot the Bill

Critics argue the payout prioritizes Musk’s ego over Tesla’s long-term stability. 'Another masterclass in extracting value from a public company,' quipped one hedge fund manager. Meanwhile, retail investors brace for dilution as new shares hit the market to cover the bonanza.

The Crypto Connection

Musk’s crypto-friendly tweets once moved markets—now they’re just background noise as Tesla’s Bitcoin treasury collects dust. A fitting metaphor for a company distracted by its CEO’s side hustles.

One thing’s clear: In the circus of modern finance, the ringmaster always gets paid—even if the lions eat the audience.

The overseas spiral

July figures are seeping in from Europe, and they show that Tesla registrations checked in 41.6% lower compared to the prior year, despite sales of electric vehicles (EVs) surging across the Continent.

It's a continuation of the sales spiral the EV Maker faced during the first half of 2025. And the problem is that the decline was supposedly due to the new Model Y being in limited supply -- but the issues appear to be deeper than that.

The new Model Y. Image source: Tesla.

The story is similar in China, another crucial market for Tesla. Its sales of China-made EVs dropped 8.4% in July compared to the prior year. That was a reversal from the small gain Tesla posted in June, which at the time reversed an eight-month losing streak.

The consumer backlash

The consumer displeasure is real, and Musk's political allegiances have pushed some buyers to new and different brands. There's evidence of the effect this is having on Tesla's once-spotless brand image, according to new data from S&P Global Mobility, which tracks sales data across the automotive industry.

The new data, shared with Reuters, showed that Tesla's consumer loyalty took a nosedive in July 2024, correlating with Musk's public commitment to an anti-environmental political campaign. According to Reuters, Tesla's loyalty peaked at 73% in June 2024 before bottoming out in March at 49.9%. No matter how you slice it, that's a quick and dramatic decline in consumer sentiment, literally driving buyers to another brand.

A massive payday

Tesla's board granted Musk 96 million shares, worth roughly $29 billion, in an attempt to keep the billionaire focused on the EV company amid his multiple businesses and ventures. The vote comes after a 2024 Delaware court ruling that voided Musk's 2018 compensation package, which was valued at over $50 billion. The court said the approval process was flawed and unfair to shareholders.

According to Automotive News, the special committee that was formed to consider the new pay package said: "While we recognize Elon's business ventures, interests and other potential demands on his time and attention are extensive and wide-ranging ... we are confident that this award will incentivize Elon to remain at Tesla."

What it all means

Tesla and its investors certainly appear to be at a crossroads. While selling EVs and zero-emission credits keeps the lights on for the young company, it constantly reminds investors that its future may be more in line with artificial intelligence (AI), robotics, and robotaxi services. Long-term investors should stay the course but should also prepare for a bumpy few quarters as the company works through its upcoming identity crisis, the slow ramp-up of the robotaxi, and an aging lineup.