Lehigh County in eastern Pennsylvania has voted to stop purchasing new Tesla stock, citing concerns over the automaker’s declining financial performance and CEO Elon Musk’s increasingly political public persona.
With over $500 million in pension assets under management, Lehigh County’s retirement board made the decision official in a 4-2 vote. It marked the first known instance of a U.S. pension fund publicly turning its back on Tesla. The board also asked its investment manager to look into ways to reduce the fund’s existing exposure to Tesla, even in passive portfolios.
Musk’s Political Engagement Sparks Backlash
Mark Pinsley, the county’s Controller and the person behind the motion, made it clear the decision wasn’t just about dollars and cents—it was about leadership and accountability. “Elon Musk’s decision to step into the political arena rather than remain focused on his customers has diluted the value of the Tesla brand,” Pinsley said in a joint statement with Tesla Takedown, a group that has been critical of Musk’s management.
Tesla’s financial decline added fuel to the fire. The company’s earnings have plummeted by 71% year-over-year, and its automotive revenue has fallen 20%. With profitability shrinking rapidly, Pinsley emphasized the importance of safeguarding the retirement funds of local workers. “We have a responsibility to our retirees and taxpayers to be smart about where we invest,” he said.
More Leaders Join the Chorus of Concern
Lehigh County may be the first to act, but it’s far from the only one raising red flags. In March, 51 lawmakers in New York urged the state to offload its $1 billion stake in Tesla. Meanwhile, a top candidate in the New York City comptroller race has promised to yank Tesla from the city’s $300 billion pension portfolio if elected.
Even current NYC Comptroller Brad Lander has publicly questioned Musk’s leadership. Though he hasn’t called for a complete pullout, the city’s pension exposure to Tesla has dropped significantly. As of late March, the city held Tesla shares worth around $831 million—a stark drop from $1.26 billion at the end of 2024.
Mounting Pressure Across the Nation—and Beyond
Leaders in other states are also stepping in. This April, eight state treasurers sent a letter to Tesla’s board, voicing concern about Musk’s distracted leadership. The American Federation of Teachers has urged major institutional investors, including BlackRock and Vanguard, to reconsider their positions in Tesla as well.
Globally, the push for divestment is gaining momentum. The Netherlands’ largest pension fund dumped its $600 million Tesla stake earlier this year. Denmark’s $20 billion AkademikerPension followed suit in March. And Canada’s largest public-sector union has called on national funds to cut ties with Tesla, though no official moves have been made there yet.
Tesla Takedown Movement Picks Up Steam
One of the more visible groups behind this growing resistance is Tesla Takedown, an activist coalition that emerged after Musk’s controversial association with the White House’s DOGE office. Originally focused on protest, the group is now working to help local governments and states create formal resolutions to divest from Musk-led ventures.
Following Tesla’s recent earnings report, the group announced it is expanding its efforts to pressure municipalities to break financial ties with all Musk-owned entities.
A Tumultuous Year for Tesla
It hasn’t been a great year for Tesla. Since January, the company’s stock has dropped more than 27%. The first quarter of 2025 failed to meet analyst expectations, reinforcing investor concerns. During the earnings call, Musk conceded that his political activities had become a distraction and said he would be stepping back from his role in Washington.
Still, the damage may already be done. Marketing experts have said Tesla’s brand, once synonymous with innovation and progressivism, is now alienating its core customer base. They warn that reclaiming trust could require major changes—and that starts with Musk.
David Reibstein, a marketing professor at the Wharton School, summed up the dilemma: “To some degree, Musk can say, ‘I don’t care because I’m so rich and I’ve got so many other ventures I can afford to lose money.’ But for shareholders who are jumping ship, it’s a real issue.”
Investor confidence appears to be waning, and Lehigh County’s move may encourage other public institutions to rethink where they’re putting their money.
