Tesla's $29 billion down payment to Musk

In what it called a "good-faith" measure, Tesla's board awarded Elon Musk an interim pay package of 96 million shares on Monday. "We know that one of your top concerns is keeping Elon’s energies focused on Tesla," Tesla directors Robyn Denholm and Kathleen Wilson-Thompson wrote in a letter to shareholders. "This award is a critical first step toward achieving that goal." In other words, more compensation for Musk is likely coming soon.

The shares, valued at about $29 billion, will vest in two years if Musk remains Tesla’s chief executive or serves in another top role.

The package will be blanked if Musk ultimately gains the right to exercise stock options from his contested 2018 compensation plan. That plan was worth $56 billion at the time. Following a shareholder lawsuit, a Delaware judge ruled the compensation was improper, finding Tesla's board had failed to fully inform shareholders before seeking approval.

In response, Musk moved Tesla's corporate registration to Texas, where he believes the company will have more latitude. Tesla has appealed the Delaware ruling, which is now under review by the state's supreme court.

Musk currently owns about 13% of the company. The new pay package would increase his stake to 16%, despite the role that Musk and his political exploits have played in harming Tesla's bottom line. As of Friday, Tesla's share price was down about 15% for the year, and the company has not reported growth in its quarterly earnings since the third quarter of last year.

Still, Tesla plans to seek shareholder approval for a "longer-term CEO compensation strategy" at its annual meeting in November, potentially allowing Musk to land an even larger pay package down the line.

Tesla found liable in fatal Autopilot crash, ordered to pay $243 million

Last Friday, a jury in Florida found Tesla partly responsible in a wrongful death lawsuit related to its Autopilot system, ordering the company to pay $200 million in punitive damages and another $43 million in compensatory damages to the victims' families.

The civil suit was centered around the role that Tesla's Autopilot software, an advanced driver-assistance system, played in the 2019 death of Naibel Benavides Leon and the grave injuries suffered by her boyfriend. Both victims were struck after a man driving a Tesla Model S sped through an intersection with Autopilot engaged.

The plaintiffs' attorneys cited "augmented video" of the collision as the deciding factor. The video evidence was developed using information stored by Tesla's Autopilot system, which the company claimed had been deleted before it was recovered by a forensic data specialist.

"What we ultimately learned from that augmented video is that the vehicle 100% knew that it was about to run off the roadway, through a stop sign, through a blinking red light, through a parked car and through a pedestrian," said Adam Boumel, an attorney for plaintiffs, "yet did nothing other than shut itself off when the crash was unavoidable."

Tesla has said that it plans to appeal the verdict, describing it as "wrong" and claiming that it will "jeopardize Tesla's and the entire industry's efforts to develop and implement life-saving technology."

"This was never about Autopilot; it was a fiction concocted by plaintiffs' lawyers blaming the car when the driver — from day one — admitted and accepted responsibility," the company added.

Other lawsuits have been brought against Tesla over its Autopilot and Full Self-Driving products, but many of them have been dismissed or settled out of court. The outcome of the Florida case could open the door for Tesla to face additional lawsuits in the U.S.

On Monday, a group of Tesla shareholders filed a proposed class action lawsuit against the automaker and Musk, alleging securities fraud. The lawsuit claims that Tesla and its chief executive obscured the risks posed by its consumer self-driving products and the Robotaxi ride-hailing fleet being tested in Austin, Texas.

In other Tesla news:

• The U.S. Air Force is interested in purchasing two Tesla Cybertrucks to use as missile test targets in anticipation of adversarial forces adopting the vehicles. "In the operating theatre it is likely the type of vehicles used by the enemy may transition to Tesla Cyber trucks [sic] as they have been found not to receive the normal extent of damage expected upon major impact," read an Air Force document justifying the proposed acquisition reviewed by The War Zone.

• GM sold more than 19,000 Chevy Equinox EV vehicles in July, more than doubling its year-over-year deliveries. While traditional U.S. automakers remain considerably behind Tesla in the EV market, an affordable version of the Equinox released last year has helped GM make up some ground. Chevy was the fastest-growing EV brand in the U.S. during the first quarter of this year.

• Tesla's sales in Britain and Germany, the two largest economies in Europe, declined by more than 55% year-over-year in July. Meanwhile, Chinese EV maker BYD nearly quadrupled its year-over-year deliveries in both countries. Elsewhere in Europe, Tesla's sales increased 83% in Norway and 27% in Spain, but saw decreases of 86% in Sweden and 27% in France.

Starlink's aggressive bids for federal broadband contracts

Starlink, the satellite internet subsidiary of Musk's SpaceX, has been aggressively bidding on contracts for the Broadband Equity, Access, and Deployment (BEAD) Program.

The $42.45 billion federal grant program seeks to expand high-speed internet access for rural Americans. BEAD was initially designed under the Biden administration primarily to build wired, fiber optic broadband infrastructure. However, changes implemented by Commerce Secretary Howard Lutnick, a Trump appointee and Musk ally, greatly increased the ability for slower satellite providers to win BEAD funding.

From FedScoop:

The new guidance moves toward a “tech-neutral approach,” making all technologies equally eligible for funding and opening the door for LEO satellite internet providers to bid on projects — and in most cases, win, as Lutnick directed states to select projects with the lowest prices.

Preliminary data from the new round of bidding published by the states in recent weeks shows companies like SpaceX and Amazon’s Project Kuiper are requesting only a fraction of the funding that some fiber providers requested in their applications…

In Texas, for example, SpaceX — under its official name of Space Exploration Technologies Corp. — bid on more than 244,000 locations, making it an applicant for most, if not all, of the state’s BEAD-eligible locations, according to Broadband Breakfast. Fiber and fixed wireless provider Nextlink internet had the second-largest number of bids in Texas, with more than 204,000, followed by Kuiper, which bid on approximately 160,000 locations…

According to Tennessee’s public BEAD data portal, it appears as though both SpaceX and Amazon Kuiper Commercial Services submitted a bid for almost every eligible location, with the total of number of satellite bids almost doubling the number of fiber bids submitted. And not only were there more applications, the satellite providers requested, on average, just one tenth of the funding fiber providers requested.

The upfront cost of installing satellite internet is significantly cheaper than building fiber optic infrastructure. But satellite internet is far slower and less reliable, and could prove more costly in the long run due to high subscription fees. Satellite internet providers are also more prone to local outages caused when too many users attempt to access the network simultaneously.

In other SpaceX news:

• Prohibitive subscription costs and sluggish speeds have led some Kenyan users to drop Starlink, according to a report from Bloomberg. The satellite internet company lost more than 10% of its users in the country during the first quarter of this year. Over the same period, terrestrial internet providers recorded 8% growth. Given the lack of wired internet infrastructure in most African countries, SpaceX considers the continent a key growth market for Starlink. But high consumer costs could limit its market potential across the Global South.

• SpaceX's request to annually launch up to 44 of its massive Starship rockets out of the Kennedy Space Center in Florida could pose a threat to the U.S. national bird, according to a draft environmental impact statement. Bald eagles inhabit areas in and around the Space Center during the colder months and could be disrupted by increased sonic booms and visual stimuli.

• A fresh crew of astronauts arrived at the International Space Station on Saturday via a SpaceX Dragon spacecraft carried by a Falcon 9 rocket.

Grok's AI video tool creates pornographic content of real people

Grok Imagine, a new generative AI video tool launched by Musk's xAI, features a "spicy" mode that can be used to create pornographic content of celebrities.

From The Verge:

[Grok Imagine] didn’t hesitate to spit out fully uncensored topless videos of Taylor Swift the very first time I used it — without me even specifically asking the bot to take her clothes off.

Grok’s Imagine feature on iOS lets you generate pictures with a text prompt, then turn them quickly into video clips with four presets: “Custom,” “Normal,” “Fun,” and “Spicy.” While image generators often shy away from producing recognizable celebrities, I asked it to generate “Taylor Swift celebrating Coachella with the boys” and was met with a sprawling feed of more than 30 images to pick from, several of which already depicted Swift in revealing clothes.

From there, all I had to do was open a picture of Swift in a silver skirt and halter top, tap the “make video” option in the bottom right corner, select “spicy” from the drop-down menu, and confirm my birth year… The video promptly had Swift tear off her clothes and begin dancing in a thong for a largely indifferent AI-generated crowd.

Grok Imagine, which is available to users who pay the $30 monthly fee for SuperGrok access, could pose legal problems for xAI. In May, Donald Trump signed into law the Take It Down Act, making it illegal to "knowingly publish" nude photos of a person without their consent, including depictions generated by AI models.

In other X and xAI news:

• The U.S. Court of Appeals for the Ninth Circuit has reinstated part of a lawsuit accusing X of allowing the proliferation of child sexual abuse material. Specifically, X must face an allegation of negligence for failing to quickly report explicit images of two missing boys to the National Center for Missing and Exploited Children.

• As part of the Grok Imagine video generator, Musk said that xAI will revive Vine, the first major platform to combine scrollable short-form videos and social media. "We recently found the Vine video archive (thought it had been deleted) and are working on restoring user access, so you can post them if you want," he said in a post on X. Twitter, now known as X, purchased Vine in 2012, before deactivating it in 2017.

• Musk announced that xAI will introduce ads to Grok to help "pay for those expensive GPUs" that power the chatbot. He noted that Grok may feature ads for products related to user questions. xAI, however, could have issues attracting top advertisers, given Grok's history of praising Adolf Hitler.

• As Tesla and Starlink look to India for growth, X, the third major piece of Musk's business empire, has been waging a free speech lawsuit against the Indian government. The authoritarian country has stringent censorship laws and often suppresses speech critical of Prime Minister Narendra Modi and other public officials. This has caused problems for X, with Indian users accounting for its third-largest user base by nationality. According to court documents obtained by Reuters, Indian authorities ordered X to take down 1,400 posts or accounts between March 2024 and June 2025.

Musk gave $5 million to Trump's super PAC during feud with president

In late June, Donald Trump's super PAC received $5 million from Elon Musk, several weeks after the outbreak of his bitter feud with the president. The donation also came about a month after Musk claimed that he would pause his political spending, as he believed he had "done enough." The donation, which was revealed in Federal Election Commission filings released last week, was one of three large contributions that Musk provided Republicans in June.

He also donated $5 million each to the Congressional Leadership Fund and the Senate Leadership Fund, the top super PACs used to fund congressional Republican campaigns.

As for Musk's claim that he would ease up on political spending, he said in May that he would continue "political spending in the future" if he had a reason. "I don’t currently see a reason," he said at the time. His official departure from the White House was announced a few days later, and the subsequent implosion of his relationship with Trump began in early June. The Trump PAC and two Republican super PACs reported receiving $5 million apiece from Musk on June 27.

Musk Minutes

The Department of Government Efficiency, the Trump administration austerity project launched by Musk, was responsible for $21.7 billion in wasted taxpayer money, according to a new report from Democratic staffers on the Senate Permanent Subcommittee on Investigations. The vast majority of the waste was caused by haphazard efforts to eliminate hundreds of thousands of federal employees. At least 200,000 employees were paid to not show up for work, while DOGE placed tens of thousands of other government workers on administrative leave as it attempted to find legal avenues to fire them or buy out their contracts. (Daily Beast)

Katie Miller, a former top member of DOGE who went on to work for Musk full-time, is no longer working for the billionaire. Instead, Miller, who is married to White House deputy chief of staff Stephen Miller, is launching a podcast marketed to right-wing women. (Axios)

The Trump administration has officially ended a policy that Musk started requiring federal workers to submit emails describing "five things" they had accomplished over the previous week. (Reuters)

Public representatives and officials in Nashville have continued to protest a private transportation tunnel that the Musk-owned Boring Company plans to build connecting the city's downtown and airport. "It is shameful and it is disrespectful that you all have made this decision without us," said Tennessee State Senator Charlane Oliver, referring to the lack of public input that the Boring Company and Republican Governor Bill Lee heard before announcing the project. (New York Times)

Musk's brain implant company Neuralink announced that it will launch a clinical study in the U.K. to test its chips on paralyzed patients. (Bloomberg)