This year has been difficult for Tesla (NASDAQ: TSLA), and Lehigh County, Pennsylvania’s pension fund, just made it a little bit worse. According to the Lehigh Valley News, the pension board voted 4-2 in favor of a motion to suspend future purchases of Tesla stock. The board also voted to advise its investment manager to create a written plan on how to divest from Tesla entirely.
“I introduced this motion out of concern for CEO Elon Musk’s political public profile and its adverse impact on Tesla’s brand and Tesla’s market performance,” County Controller Mark Pinsley reportedly said in a statement,”With Tesla’s earnings down 71% year-over-year and auto revenues falling 20%, our $500 million pension board prioritizes fiduciary responsibility. I believe this decision protects our retirees and may serve as a precedent for other institutional investors.”
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Pinsley’s statement referenced Musk’s role with the Department of Government Efficiency as part of the motivation behind the decision. “This is the first pension fund to make a public decision in response to Elon Musk’s nefarious activities with DOGE,” he said. However, the statement also noted that Tesla profits have “Taken a sharp dive. We owe it to our retirees and taxpayers to take a hard look at whether these are wise investments at this time.”
This would not be the first incident of a public pension fund divesting its Tesla interests. In March, Bloomberg reported that Denmark’s $20 billion AkademikerPension was dropping its Tesla shares. The fund’s CEO, Jens Munch Holst, took direct aim at Musk in his announcement explaining the divestiture decision. Holst said, “In short, it’s our view that Elon Musk is in the process of destroying Tesla’s brand and value.”
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Business Insider reported on Dutch pension fund ABP’s decision to divest from Tesla in January. That sell-off saw nearly $600 million worth of Tesla stock hit the market, something which likely contributed to the company’s massive stock slide. A blog post by ABP President Harman Van Wijnen took issue with the $50 billion bonus Tesla’s board authorized for Musk. “We felt this amount was not in line with our rules for good governance,” he wrote.
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