Tesla’s fate and its identity as more than just a meme stock hang in the balance as shareholders vote on CEO Elon Musk’s colossal $47 billion compensation package. The outcome of this vote could determine whether Musk stays or goes, potentially reshaping the company’s future, according to investor Roger McNamee in a recent CNBC interview.
“If the pay deal doesn’t get approved, it’s likely going to cost the company Musk’s leadership,” McNamee stated, highlighting the gravity of the decision facing Tesla’s shareholders. He further elaborated on the implications: “It’s a test of Tesla as a meme stock, because if Musk is no longer viewed as central to the story going forward, then I think Tesla starts to trade like a car company, as opposed to an extension of Elon Musk.”
This sentiment mirrors criticisms from figures like short-seller Jim Chanos who have labeled Tesla a “hopes and dreams” stock, suggesting its market success is more tied to the cult of personality around Musk rather than its financial fundamentals.
The vote comes at a tumultuous time for Tesla, with the company’s stock down nearly 40% this year amid broader market volatility. The downturn was exacerbated by a recent announcement of significant layoffs and disappointing vehicle delivery numbers for the first quarter—marking its first year-over-year quarterly decline since 2020.
Wall Street’s reaction has been decidedly mixed, with many analysts cutting their price targets on Tesla, reflecting growing concerns about its future trajectory and Musk’s recent controversial behaviors, which some investors believe are distracting him from his duties at Tesla.
Despite these challenges, McNamee believes the pay package will likely pass. Echoing this view, Wedbush Securities analyst Dan Ives emphasized the importance of this decision but cautioned that approval wouldn’t solve all of Tesla’s problems. “In our view, the clock has struck midnight for Musk to now lay out the growth strategy, give realistic delivery and margin goal posts, discuss why significant layoffs now, and most importantly give a clear outlook to the Street around Model 2,” Ives wrote in a note to clients.
Ives has previously suggested that an ideal resolution might involve a new compensation package that would secure Musk’s leadership at Tesla until at least 2030, ensuring stability and vision at the helm.
“This vote is the test that investors get to say which way they want to go,” McNamee concluded, underscoring the critical nature of the upcoming decision not just for Tesla’s operational strategy, but for its very identity in the eyes of investors and the market at large.