Elon Musk, the founder and chief executive of electric car company Tesla, would smash all pay records and become the richest man in the world if an extraordinarily ambitious new incentive scheme pays out.

The 46-year-old entrepreneur, who is already a multibillionaire, has agreed to work unpaid for the next 10 years – after which he would collect an unprecedented US$55.8 billion bonus if he builds the 14-year-old business into a US$650 billion company within a decade.

If Musk achieves the hugely ambitious target, it would be by far the biggest ever executive windfall.

“Elon will receive no guaranteed compensation of any kind – no salary, no cash bonuses, and no equity that vests by the passage of time,” the company said of the new pay plan . “Instead, Elon’s only compensation will be a 100 per cent at-risk performance award, which ensures that he will be compensated only if Tesla and all of our stockholders do extraordinarily well.

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“For Elon to fully vest in the award, Tesla’s market cap must increase to US$650 billion.”

The vast pay deal is designed to end speculation that Musk might leave Tesla to focus on some of his other ventures, including his plan to colonise Mars using rockets made by his space exploration company, Space X . The long-term renumeration plan, which the company announced yesterday, will only pay out if he continues to serve as CEO, executive chairman and chief product officer.

The maximum payout will only be made if Tesla’s market value increases to at least US$650 billion, an increase of about 1,000 per cent on the company’s current market capitalisation of US$59 billion. At today’s share prices, only three companies in the world are worth more: Apple (US$908 billion), Google’s parent company, Alphabet (US$807 billion) and Microsoft (US$707 billion).

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“We believe Tesla has a unique opportunity to continue delivering stockholder value,” Tesla’s board, which includes James Murdoch, said in a letter to shareholders.

“Our aspirations may appear ambitious to some, and impossible to others, and that is by design. We like setting challenging, hard-to-achieve goals for ourselves, and then focusing our efforts to make them happen. This is why we based this new award on stretch goals and why we gave Elon the ability to share in the upside in a way that is commensurate with the difficulty of achieving them.”

The award will pay out in 12 tranches, depending on market capitalisation and revenue targets. To collect the first payout of 1 per cent of the company’s shares – worth about US$600 million at today’s share price – Tesla’s market value must hit US$100 billion. Musk will collect additional 1per cent stock grants for every additional US$50 billion increase in market value. To hit the final target Tesla will also have to hit sales and profits targets, including revenue of US$175 billion-a-year, which is more than General Motors’ sales.

Musk, who is already the world’s 44th richest person with a US$21.5 billion fortune, according to Bloomberg’s billionaires index , is Tesla’s biggest shareholder with a 21.9 per cent stake.

If he keeps all his shares and achieves the maximum bonus target, he could end the decade with 28.3 per cent of Tesla’s shares (if the company does not release any more).

If Tesla hits the US$650 billion valuation target, his stake would be worth US$184 billion, making him easily the world’s richest man.

Tesla’s shareholders will vote on the proposals in March. Musk, and his brother Kimbal, who is Tesla’s third-biggest shareholder, will recuse themselves from the vote.