Tesla puts xAI investment to shareholder vote
Tesla will ask shareholders at its annual meeting to decide whether the company should invest in Elon Musk's AI startup xAI. The company filed proxy materials outlining the proposal.
Tesla outlined the ballot item in its annual proxy statement released. The vote will take place at the company's 2025 annual meeting on November 6 in Austin, Texas. The board is not taking a position on the proposal, leaving the decision to shareholders.
The vote addresses whether Tesla should take a stake in xAI, a privately held AI company that Musk founded in 2023. Earlier this year, xAI merged with Musk's social platform X. SpaceX committed $2 billion to the startup, creating closer operational ties across Musk-led businesses.
The vote addresses whether Tesla should take a stake in xAI, a privately held AI company that Musk founded in 2023. Earlier this year, xAI merged with Musk's social platform X. SpaceX committed $2 billion to the startup, creating closer operational ties across Musk-led businesses.
Musk told investors in July that he planned to put the question to a shareholder vote while ruling out a full merger between Tesla and xAI. On July 13, he wrote on X that he would have preferred Tesla to invest in xAI earlier and confirmed that shareholders would decide the matter through a vote.
The proxy disclosure follows months of discussion regarding Tesla's participation in Musk's AI efforts. Tesla has started integrating xAI's Grok chatbot into its vehicles. Musk has argued that closer collaboration could accelerate software and autonomy development.
If approved, an investment could further integrate Tesla with Musk's AI ecosystem, which already includes xAI's merger with X and financing from SpaceX. The xAI has raised significant funding since its founding, with its valuation reaching billions of dollars.
The proxy statement does not outline valuation details for a special committee to evaluate terms. Those details would be determined in future negotiations. Shareholders will weigh potential strategic benefits against corporate governance considerations when they vote in November.
The November meeting will also include a vote on a new long-term compensation plan for Musk. The board endorsed the package on Friday. The compensation plan is designed to retain Musk at Tesla through at least 2030 and will be considered at the same meeting as the xAI proposal.
The proxy disclosure follows months of discussion regarding Tesla's participation in Musk's AI efforts. Tesla has started integrating xAI's Grok chatbot into its vehicles. Musk has argued that closer collaboration could accelerate software and autonomy development.
If approved, an investment could further integrate Tesla with Musk's AI ecosystem, which already includes xAI's merger with X and financing from SpaceX. The xAI has raised significant funding since its founding, with its valuation reaching billions of dollars.
The proxy statement does not outline valuation details for a special committee to evaluate terms. Those details would be determined in future negotiations. Shareholders will weigh potential strategic benefits against corporate governance considerations when they vote in November.
The November meeting will also include a vote on a new long-term compensation plan for Musk. The board endorsed the package on Friday. The compensation plan is designed to retain Musk at Tesla through at least 2030 and will be considered at the same meeting as the xAI proposal.
