Several state treasurers, from states that collectively invest hundreds of billions of dollars of public pension assets, have informed the board of Tesla Inc. that they are concerned about the performance of Tesla’s stock, as well as where Tesla CEO Elon Musk is focusing his attention.
The April 17 letter, signed by seven state treasurers and the controller of California and presented by Americans for Responsible Growth, an advocacy group focused on ensuring responsible fiscal stewardship, asked the board of Tesla to “act decisively to ensure the company returns to a stable and focused trajectory.”
Tesla shares are down nearly 40% so far this year. The company, which Tuesday evening announced that company profits fell 71% in the first quarter of 2025, has grappled with a decline in deliveries and increased competition in China from upstart automakers like BYD and Xiaomi. Tesla reported Q1 2025 revenue of $19.34 billion, below the $21.3 billion it reported a year ago.
“Tesla, Inc. is not just one of the world’s most valuable companies—it is a major player in the clean energy economy and a leading force in emerging technologies such as robotics and autonomous driving,” the letter stated. “The company’s success or setbacks have significant implications for workers, regional industries, and innovation ecosystems in our states.”
The signatories were also concerned with Musk’s divided attention across his multiple companies, including X, XAI, SpaceX and Neuralink, as well as his role as the head of the Department of Government Efficiency service temporary organization.
“These external commitments raise serious questions about whether Tesla’s leadership is fully engaged in addressing the company’s core challenges,” the letter stated. Musk’s position at DOGE and closeness with the administration of President Donald Trump has drawn criticism from investors and fiduciaries.
“The Board’s role is especially critical now—to provide strong oversight, uphold fiduciary standards, and ensure that the company’s leadership is aligned with the long-term best interests of the company,” the letter stated. “Public officials like us do not take the step of raising these concerns lightly except when the obvious risks demand it.”
The letter called for the Tesla board to provide clarity on the following questions:
- How is the board ensuring that Musk and Tesla’s leadership team are devoting adequate time and focus to resolving recent performance issues and guiding the company’s future direction?
- In light of the company’s underperformance, how is the board evaluating whether executive compensation remains aligned with shareholder value and corporate accountability? and
- How does the board plan to communicate its strategy for navigating this period of uncertainty and restoring investor and public confidence in Tesla’s leadership?
“Finally, we strongly believe Tesla’s board would benefit from engaging with public sector stakeholders who share an interest in the company’s long-term value and societal impact,” the letter stated. “We welcome the opportunity to speak further about these concerns and discuss how the board can take swift and transparent action to restore investor confidence and public trust in Tesla’s leadership and the company’s future.”
Several institutional investors have criticized Tesla’s governance and Musk’s political ventures at DOGE. New York City Comptroller Brad Lander earlier this month called for the city’s law department to pursue securities litigation against Tesla over what he identified as the board’s failure to properly oversee Musk.
“Ever since Elon Musk took over DOGE and became best-friend-in-chief with President Trump, Tesla—where Musk is supposed to be CEO—has suffered financially, causing enormous losses for Tesla shareholders,” Lander said in a statement earlier this month. “In less than three months, Tesla stock has lost nearly 40% of its value, with losses over $300 million for the New York City pension systems.”
Danish pension fund AkademikerPension in March announced plans to sell its remaining shares of Tesla and add the company to its exclusion list if major changes were not made.
In early April, the Canadian Association of Professional Employees, one of the largest public sector unions in Canada, called on the Public Sector Pension Investment Board, as well as all Canadian pension funds, to divest from their Tesla holdings.
Signatories of the ARG letter, in the order listed, included:
- Washington State Treasurer Mike Pellicciotti (signing the letter solely in his official as a state treasurer);
- Massachusetts State Treasurer and Receiver-General Deborah Goldberg;
- Illinois State Treasurer Michael Frerichs;
- Connecticut Treasurer Erick Russell;
- New Mexico State Treasurer Laura Montoya;
- Colorado State Treasurer David Young (signing the letter as an elected official and not as a fiduciary);
- Vermont State Treasurer Mike Pieciak; and
- California State Controller Malia M. Cohen.
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