By Nathalie Voit

Tesla revealed its plans to put a 3-for-1 stock split to a shareholder vote in its 2022 proxy statement filed with the U.S. Securities and Exchange Commission (SEC) on June 10.

“Our success depends on attracting and retaining excellent talent, not only through providing a respectful, safe, inclusive and equitable workplace, but also through offering outstanding benefits and highly competitive compensation packages. Unlike other manufacturers, we offer every employee the option of receiving equity,” read Tesla’s proxy statement. “We believe the Stock Split would help reset the market price of our common stock.” 

The electric vehicle maker noted its stock price surged by 43.5% since its last stock split in August 2020.  Tesla said lowering the price per share will also make its stock “more accessible to retail shareholders” and give its employees “more flexibility in managing their equity.” To trigger the split, Tesla said shareholders must first approve an increase in the number of authorized shares available.

“As of June 6, 2022, we have 1,036,390,569 shares of common stock outstanding,” Tesla wrote in the filing.

“The Authorized Shares Amendment provides for an increase in the number of authorized shares of Tesla’s common stock from 2,000,000,000 shares to 6,000,000,000 shares,” Tesla said.

Once the amendment is authorized, Tesla said its board of directors can move forward with the proposal:

“Our Board intends to approve the Stock Split, subject to and contingent upon stockholder approval of the Authorized Shares Amendment.”

The automaker urged investors to sign off on the move, set to be voted on at the company’s annual shareholder meeting in Austin, TX, on August 4.

The news comes amid a broader market sell-off on Monday that saw the tech-heavy NASDAQ Composite Index tumbling 4.68% end-of-day. Shares of Tesla have tumbled about 40% since Elon Musk disclosed his outsized stake in Twitter in early April.