Lehigh County's $500 Million Pension Fund Halts Tesla Investments
Today, Lehigh County took a step that no other U.S. pension fund has taken: We suspended all new Tesla stock purchases in our actively managed pension funds. The reason is simple: Elon Musk’s political activity creates real financial risk, and Tesla’s latest numbers show it. Earnings are down 71%. Revenues are falling. The brand is suffering.
But this isn’t just about one company or one county. Every county, municipal, or state pension board has a fiduciary duty to act when the facts demand it. So here’s what you can do:
Ask your local pension board: Will you be reviewing your Tesla holdings?
Contact your municipal leaders: How are they protecting taxpayer and retiree funds?
Write an op-ed or letter to the editor in your local paper talking about what Lehigh County did and demanding transparency and action.
LEHIGH COUNTY, PA – May 6, 2025: Today, the Lehigh County Pension Board, overseeing $500 million in assets, instructed its investment manager to immediately cease all new investments in Tesla, owing to concerns over Elon Musk’s political activity and the negative impacts it’s having on the company. This is the first pension fund to make a public decision in response to Elon Musk’s nefarious activities with DOGE.
The Lehigh County Pension Board voted 4-2 in favor of the motion calling for an immediate pause in new investments in Tesla in Lehigh County’s actively managed funds. In addition to the immediate pause of new investments, the motion also directed Lehigh County’s investment manager to produce a report detailing how the pension fund can divest its passively managed funds from Tesla.
Mark Pinsley, the Lehigh County Controller, who introduced the motion, said: “Elon Musk’s choice to become a political figure rather than a customer-focused leader has compromised the Tesla brand. Tesla’s earnings are down 71% from a year ago, their auto revenues have dropped 20%, and profitability has 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.”
Lehigh County's proactive approach is particularly notable, as it sets a precedent for other pension funds. While other institutional investors have voiced apprehensions or called for reviews, Lehigh County is the first US-based pension fund to pause new investments in Tesla, reflecting a commitment to fiduciary responsibility and risk management.
Lehigh County is not alone in having concerns about the impact of Musk’s political activity on Tesla’s market performance, however.
Divestment Momentum Builds Among Global Leaders
In January, the Dutch pension fund, ABP, sold its $600 million stake, citing long-term concerns about working conditions and governance. In March, the $20 billion Danish pension fund, Akademiker, divested its shares due to reputational risks linked to Musk’s political activity.
In the US, 23 New York State Senators and 28 Assembly Members publicly called for the State of New York to divest its $1 billion in shares from Tesla; a leading candidate for the New York City Comptroller race has pledged to divest the city’s $300 billion pension funds from the company; and eight State Treasurers have written an open letter to the Tesla board, expressing concerns about Musk’s management of the company.
Meanwhile, the largest public-sector labor union in Canada has called on Canadian public pensions to divest from Tesla, and the American Federation of Teachers has called on BlackRock, Vanguard, and other asset managers to explore divestment from Tesla.
“I think anyone taking their fiduciary duty seriously should be considering whether Tesla is a smart company to invest in,” added Pinsley. “We don’t yet know the full long-term impact, but Musk’s political actions have introduced significant risk to the company, and the financial results already reflect it, as more customers turn to brands that better keep the spotlight on the product, not the politics."
The text of the motion can be viewed here; the Pension Board expects to revisit the issue at its next meeting.