Elon Musk is mad at one of Tesla's biggest investors for saying it's voting against his pay package

• Telsa faces investor pushback on reinstating Elon Musk's $55 billion pay package.

• The largest public pension fund in the US currently plans to vote against the pay plan.

• Musk called out the pension fund for "breaking their word."

Tesla is facing increasing pushback from investors regarding its bid to reinstate Elon Musk's $55 billion pay package.

On Wednesday, there was yet another sign that Tesla might be facing an uphill battle when the CEO of the California Public Employees' Retirement System, Marcie Frost, told CNBC the fund plans to vote against the proposal to reinstate Musk's pay plan, pending any future conversations with Tesla.

"We do not believe that the compensation is commensurate with the performance of the company," Frost said.

CalPERS is the largest public pension fund in the US and is among one of Tesla's 30 largest investors with about 9.5 million shares, according to Bloomberg. Frost told CNBC that the fund initially voted for Musk's pay package when it was taken to a shareholder vote in 2018, but CalPERS later corrected her comments in a post on X, clarifying that the fund voted against the proposal in 2018 as well.

Musk does not receive a salary from Tesla and his pay package is centered on a series of goalposts around the carmaker's financial growth. The plan, which was valued at $55 billion by Bloomberg when it was struck down by a Delaware judge in January, involves a 10-year grant of 12 tranches of stock options that are vested when Tesla hits specific targets. When the company hits each milestone, Musk gets stock equal to 1% of outstanding shares at the time of the grant. Tesla said it hit all of the 12 targets as of 2023.

Musk quickly posted on social media to criticize CalPERS's stance on the proposal on Wednesday.

"What she's saying makes no sense, as all the contractual milestones were met. CalPERS is breaking their word," Musk wrote on X.

CalPERS is joining a growing list of investment funds that are publicly expressing their desire to vote against Tesla's compensation plan for Musk. On May 21, a group of shareholders filed a letter with the Securities and Exchange Commission calling for investors to vote against both Musk's pay package and the proposal to reelect James Murdoch and Kimbal Musk. Separately, proxy advisory firm Glass Lewis said in a report on Saturday that the pay plan was "excessive" and presented investors with "uncertain benefits and additional risk."

Meanwhile, Tesla has been pulling out all the stops to promote the proposal. On Wednesday, the company began offering investors the opportunity to tour the Texas gigafactory alongside Musk in exchange for proof they'd voted in Tesla's annual meeting. Tesla has also argued the compensation plan is "critical to the future success of Tesla" and has even paid for a handful of advertisements promoting the pay plan.

The annual meeting for investors will take place on June 13. Shareholders will be asked to vote on several proposals in addition to the proposal to reinstate Musk's pay package, which was struck down by a Delaware judge earlier this year. The company is also asking investors to vote on a proposal to move Tesla's state of incorporation from Delaware to Texas and a separate proposal to reelect Tesla board members Kimbal Musk and Murdoch.

A spokesperson for Tesla did not immediately respond to a request for comment.

Correction, May 30: This story has been updated to reflect that CalPERS has said it voted against the 2018 pay proposal for Elon Musk, not for it, as its CEO initially said during the interview with CNBC.

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