Meet the former Tesla diehards now selling their shares

Elon Musk’s role in the Trump administration turns off some loyal investors; stock is down more than 40 per cent this year

US President Donald Trump spruiking Tesla earlier this month in a show of support to Elon Musk. Picture: AFP

Michael Hanna once admired Elon Musk so much that Tesla stock made up about 25 per cent of his portfolio. But in February, put off by the chief executive’s behaviour as part of the Trump administration, Hanna sold the last of his shares.

Hanna, a data architect in Washington state, considers himself politically independent and supports some of the goals that Musk and President Trump have pursued, such as trimming the federal budget and reviving American manufacturing. But he has been bewildered by Musk’s chainsaw-waving leadership of the Department of Government Efficiency, which he called “chaotic.” Controversy surrounding Musk is bad for Tesla sales, he said.

“I think the brand is irreparably damaged at this point,” Hanna said.

Just a few months ago, investors were betting that a second Trump administration would be great news for Tesla. Instead, the longtime stockmarket highflier has plummeted in 2025. Shares have fallen more than 40 per cent this year, erasing about $536 billion in market value. The stock is on track for a nine-week streak of losses — its longest on record.

Protesters hold signs and sing chants during a protest against Elon Musk and his Tesla car company in Boston on March 15. Picture: Joseph Prezioso / AFP

Part of that decline stems from investors’ broad retreat from the “Magnificent Seven” tech stocks that drove markets higher last year. Worries about economic growth and Trump’s trade fights have driven declines in some of the market’s biggest gainers. Tesla’s business has also faced unique challenges. Competition has increased while sales have faltered; on Thursday, the company recalled most Cybertrucks because an exterior panel might fall off and endanger motorists.

But Musk’s role in the administration has repelled some of the fans who helped popularise Tesla cars and make the stock one of Wall Street’s hottest trades. For some, mass firings of federal workers are the issue, while others are concerned with his social-media posts or just think he is too distracted with government business to run Tesla. Protesters have demonstrated at Tesla showrooms and some cars and charger stations have been vandalised.

The topic has entered the political arena, with Trump administration officials talking up Tesla. Trump earlier this month selected a red Tesla sedan at the White House in a show of support. Commerce Secretary Howard Lutnick used a TV appearance this week to recommend the public buy shares, saying: “It’s unbelievable that this guy’s stock is this cheap. It’ll never be this cheap again.”

Individual investors have long flocked to the shares, betting that Musk’s leadership could make Tesla worth far more than an ordinary car company. It was the kind of loyalty that inspired at least one to get the company’s logo tattooed on his arm.

Plenty of individual investors are still piling in. Of the $8.3 billion that individual investors poured into single stocks last week, roughly $3.2 billion flowed into Tesla, according to a Wednesday report from JPMorgan analysts.

Michael Hanna, who has sold all of his Tesla shares, says the brand is ‘irreparably damaged.’ Photo: Cecilia Adalynn Photography LLC

But investors’ devotion is being tested. Some sellers say they are driven by disapproval of Musk’s government cuts, or moral opposition to his more controversial social-media posts.

Edward Sanchez, based in San Jose, Calif., was both a Tesla car owner and shareholder until just a week ago, when he sold the stock. Now, he’s considering getting rid of the car, too.

He purchased the vehicle in 2016 and then about 150 shares in the company five or six years ago, having bought into Musk’s techno-utopian vision for electric vehicles. That resonated with Sanchez, a tech worker who likes to support environmentalist causes.

“It was a very innovative car. There was nothing at all like it back then,” he said of his 2016 Model S. “It was cool to be associated with the brand and with such a smart person.”

As Musk became more involved in conservative politics, Sanchez’s scepticism grew. He was appalled when the CEO made a gesture at an inauguration event in January that some interpreted to be a Nazi salute. The recent display of various Tesla models in front of the White House was another cringe-worthy moment, he said.

Sanchez finally liquidated all his shares in March, he said, though his financial adviser suggested he hold on and wait for the stock price to recover some of its losses. “I told him, ‘I don’t care, I want out.’”

For others, the concern is more practical. Tony Herbert first spotted a Tesla at a birthday party in 2012 in Dallas and immediately wanted one for himself. In 2018, he invested around $5,000 in the company — the first stock he ever bought — with the goal of using profits from the rising share price to purchase a Model 3.

In the years that followed, his investment ballooned. But in February, he sold it all. He felt that billionaires were being villainized by the public, and he was starting to lose faith that the stock could stay on track. Herbert said he would consider jumping back in at a lower price. First, he would like to see one change in the company: a new executive.

“Elon’s too focused on other things,” he said.

The Wall Street Journal