Rivian unveils $4.6 billion pay plan for CEO RJ Scaringe, similar to Tesla’s Elon Musk. The deal includes new profit targets and lower share price milestones. The move aims to retain the founder’s focus on growth, especially with the upcoming launch of the R2 SUV to compete with Tesla.

The revised plan replaces an earlier one deemed unlikely to be met, reflecting Rivian’s strategic shift amid challenges like the removal of key EV tax credits. The company recently cut about 600 jobs to streamline operations.

Tesla shareholders approve a $1 trillion pay package for Elon Musk, setting operational and valuation milestones over 10 years. Rivian’s approach may not mirror Tesla but reflects a trend in tying CEO rewards to market gains. Many firms are considering similar pay structures inspired by Musk’s success.

Under the new plan, Scaringe receives options for 36.5 million shares, with vesting tied to stock price and performance goals over 10 years. The new package, representing 3% of Rivian, aims to align CEO pay with shareholder returns. Scaringe’s position makes the deal more reasonable than Musk’s.

If Rivian achieves all milestones, Scaringe could receive up to $4.6 billion, while shareholders could see a $153 billion value increase. The board doubled Scaringe’s base salary to $2 million, emphasizing alignment with shareholder returns. Scaringe also gains economic interest in Rivian’s AI technology spinoff.

Read more at Yahoo Finance: EV maker Rivian gives CEO a Musk-style pay package worth up to $4.6 billion