Potential Merger Shifts Focus to Musk’s Voting Power

A potential merger between SpaceX and Tesla could reshape Elon Musk’s voting control over the companies, while leaving the financial rewards tied to his compensation packages subject to separate conditions.

Musk said during a SpaceX earnings call last month that special committees at both companies’ boards had been formed to discuss a possible merger.

According to a Reuters review of the compensation arrangements and interviews with six executive-compensation experts, the transaction could provide Musk with the voting influence he has sought at Tesla without requiring him to meet the milestones in his existing pay plan.

However, the deal would not automatically trigger an immediate $1 trillion stock award. Musk would initially likely receive only a portion of the Tesla shares associated with the compensation package approved last year.

SpaceX Compensation Plan Grants Voting Rights Upfront

SpaceX’s compensation structure gives Musk voting rights associated with awarded shares before he earns their economic value.

Ahead of the company’s planned initial public offering, the board granted stock awards tied to market-capitalization targets, establishing a colony of one million people on Mars and developing large-scale space data centers.

Although Musk received voting power associated with the shares immediately, he cannot realize their financial value unless the specified goals are achieved. The arrangement has given him approximately 85% voting control over SpaceX without requiring him to meet the performance milestones, according to the report.

The distinction between voting rights and economic ownership is central to understanding how a merger could affect Musk’s position. Experts cited by Reuters said the structure could provide a route to greater control at Tesla, making the ambitious performance targets less central to the immediate governance question.

Tesla Pay Package Links Rewards to Performance

Tesla’s compensation plan operates differently. The package approved last year offers Musk up to $1 trillion in stock, but the awards depend on achieving operational and market-capitalization milestones over time.

Musk has not yet achieved any of the targets. Even if all milestones were reached, including a nearly eightfold increase in Tesla’s market capitalization, his voting power would rise to approximately 29%, according to documents presented by the board.

Musk previously identified voting control as a key concern, saying in an October 2025 earnings call that he wanted sufficient influence over Tesla as the company pursued AI-powered robotics.

The contrast between the two arrangements is significant: SpaceX granted voting rights upfront, while Tesla tied additional voting influence to future performance.

SpaceX Board Could Restructure Compensation Terms

The SpaceX compensation agreement provides less clarity about what would happen following a merger. Compensation experts told Reuters that the board could have considerable flexibility to revise the arrangement after a transaction.

One potential approach would involve increasing market-capitalization and earnings targets while adjusting share awards to reflect the larger combined company. USC finance professor Kevin Murphy suggested that the existing plans could remain in place with revised targets and allocations.

SpaceX previously assumed Musk’s compensation plan from xAI after acquiring the company earlier this year, providing an example of how his compensation arrangements have been handled following a corporate transaction.

Based on SpaceX’s current shares outstanding, the stock awards under Musk’s plan could be worth $719 billion at the highest market-capitalization target, according to research firm Equilar.

Ambitious Milestones and Corporate Governance

The SpaceX plan includes demanding objectives, including establishing a Mars colony with one million residents and developing space-based data centers capable of delivering 100 terawatts of computing capacity annually.

Four of the compensation experts cited by Reuters said the board could likely amend the plan. They also emphasized that Musk’s existing ownership of nearly half of SpaceX makes the additional economic value of the awards less important to his control position.

The experts’ assessment suggests that the governance implications of a merger could be more immediate than the financial rewards tied to the compensation milestones.

What Investors Should Watch Next

Investors will be watching whether the special committees advance merger discussions and how any proposed transaction addresses voting rights, stock awards and existing compensation agreements.

The treatment of Musk’s SpaceX and Tesla packages could become a central governance issue in a combined company. The distinction between immediate voting control and performance-based economic rewards will remain important when assessing the potential structure and implications of a deal.