Elon Musk Purchases $1 Billion in Tesla Stock
Musk balances investor confidence against political issues by purchasing $1 billion worth of Tesla shares as the board pushes for a trillion-dollar pay agreement.
Elon Musk’s purchase of over $1 billion (£735 million) worth of Tesla stock represents his first open-market acquisition since 2020 and demonstrates his growing faith in the electric vehicle manufacturer. Early Monday trading saw Tesla’s stock rise more than 6% as a result of the move.
Musk, who currently owns roughly 13% of Tesla, has been advocating for investments in automation, artificial intelligence, and robotaxis in an effort to gain more control over the business. As Tesla struggles with declining sales, more competitive markets, and the elimination of US tax benefits for electric vehicles, he bought roughly 2.5 million shares on Friday.
In addition to the $29 billion “interim” award that was announced last month following the court’s decision to invalidate a 2018 pay pact, the board has suggested a $1 trillion compensation package that could increase Musk’s shareholding by up to 12%. Musk has threatened to leave the company completely if he doesn’t have more authority, and he has occasionally requested a 25% ownership.
Markets typically react favorably when CEOs invest in their own companies, according to Danni Hewson of AJ Bell, but he joked that Musk might also be motivated by competition. “An ingenious and reckless interpretation is that he chose to boost Tesla stock after learning that Larry Ellison had become the richest man in the world.”
Musk’s political involvement has damaged Tesla’s reputation. Before a sour break, he openly supported Donald Trump in the 2024 election. Since then, he has sided with far-right leaders in Germany and the UK. Following a video appearance at a protest in London organized by far-right activist Tommy Robinson, where Musk urged the crowd, “Violence is coming, fight back or die,” the British government accused him over the weekend of using “dangerous and inflammatory language.”
Although Chair Robyn Denholm acknowledged last week that Musk’s politics are “up to him,” the board of Tesla maintains the new compensation scheme is also intended to keep Musk’s attention on the business. He is, nevertheless, “the right CEO for Tesla over this transformative period of time,” according to her.
