Tesla stock (TSLA) continues its impressive rally, soaring over 16% this week and marking its fourth straight week of gains. The electric vehicle giant’s recent stock surge is driven by investor excitement surrounding a new compensation package under consideration for CEO Elon Musk, alongside the announcement of a high-profile addition to Tesla’s board of directors.
Tesla Stock Rallies with Musk Pay Package and Board Changes in Focus
Tesla shares closed higher on Friday, recouping a significant portion of the losses experienced earlier in the year. After plunging more than 40% in April, Tesla stock is now down only 13.7% year-to-date, reflecting renewed investor confidence. CEO Elon Musk himself celebrated the stock’s upward momentum in a recent post on his X account.
Adding to the positive market sentiment is Tesla’s announcement that Jack Hartung, president of Chipotle Mexican Grill (CMG), will join Tesla’s board as its ninth member starting June 1. Hartung, who will retire from Chipotle to transition into a senior advisory role, also serves on boards of several other companies, including Portillo’s and the Honest Company. At Tesla, Hartung will contribute to the board’s audit committee, a critical oversight body.
Tesla Board Under Scrutiny Amid Musk Compensation Debate
Tesla’s board has recently faced scrutiny over its independence and compensation decisions, especially concerning CEO Elon Musk’s pay. The Financial Times reported that the board formed a special committee to explore alternative compensation packages for Musk, including stock options. This move comes as Tesla appeals a Delaware Supreme Court decision related to Musk’s 2018 pay package, originally valued at $56 billion.
The high-profile dispute over Musk’s compensation has drawn criticism from major shareholders, who have voiced concerns about the scale of his potential earnings and Musk’s ultimatum threatening to withdraw key projects like AI development from Tesla unless his pay demands are met.
Despite speculation, Tesla board chair Robyn Denholm denied reports suggesting that the board is seeking a CEO replacement or pressuring Musk to return to daily operations to calm investor concerns. Denholm, who has sold over $538 million in Tesla stock since joining the board in 2014, has also faced investor questions regarding her own compensation.
What’s Next for Tesla Stock?
With Tesla’s stock climbing steadily, investors are watching closely how the board’s decisions on leadership compensation and governance might impact the company’s future performance. The recent board expansion and ongoing pay package deliberations highlight Tesla’s efforts to stabilize governance amid rapid growth and market volatility.
