Tesla stock keeps falling. Now a teachers’ union wants big money managers to rethink their investments

As Tesla shares continue to decline amid CEO Elon Musk’s controversial behavior and involvement in politics, one of the nation’s largest labor unions is worried about just how low the stock could go.

On Thursday, American Federation of Teachers (AFT) president Randi Weingarten sent a letter to the CEOs of six major asset management firms, outlining the union’s concerns over Tesla’s recent stock struggles and urging asset managers to reassess investments in the EV maker.

Weingarten pointed to Tesla’s stock price dropping to as low as $290.80 from a high of $489, as well as the company’s market capitalization falling below $1 trillion. She argued that Tesla’s latest financial disclosures should raise red flags, citing missed profit margin expectations and rising cost pressures.

“These are not isolated incidents but rather a troubling pattern that suggests Tesla’s pricing power is eroding, leaving it vulnerable to market fluctuations and increased competition,” Weingarten wrote.

The letter was sent to Larry Fink of BlackRock, Abigail Johnson of Fidelity, Ronald O’Hanley of State Street, Thasunda Duckett of TIAA, Robert Sharps of T. Rowe Price, and Salim Ramji of Vanguard. Musk and Tesla’s board were copied on the letter as well, reported the the New York Times.

Fast Company reached out to Tesla for comment.

Weingarten also detailed Tesla’s struggles in Europe, noting a 60% decline in sales in Germany—Europe’s largest auto market. Additionally, she pointed to growing competition in the EV charging sector, particularly with the launch of IONNA, a rival charging network backed by Mercedes, BMW, General Motors, Stellantis, Honda, Hyundai, Kia, and, most recently, Toyota.

Musk’s Divided Attention

Tesla’s financial troubles come after the company received shareholder approval for Musk’s $56 billion pay package, Weingarten noted.

When gathering shareholder approval for the proposal, Tesla board chair Robyn Denholm wrote, “Fairness and respect require that we honor the collective commitment we made to Elon—a commitment that was, and fundamentally still is, about retaining Elon’s attention and motivating him to focus on achieving astonishing growth for our company.”

Following the pay package vote, Musk has since established himself as a close adviser to President Trump and is now moving to slash the size of the federal workforce via his Department of Government Efficiency (DOGE). The Trump administration has also announced a halt to federal funding for the expansion of highway EV charging infrastructure, according to Weingarten’s letter.

She also pointed to a decline in Tesla’s brand perception, citing data from the American EV Jobs Alliance. According to the organization, “EV swing consumers”—those open to purchasing an EV once costs drop—hold negative views of Musk, further complicating Tesla’s ability to expand its customer base.

Weingarten ended her letter by calling for asset managers to take action.

“Given these mounting concerns and the potential material impact on pension fund portfolios, I would appreciate a response detailing your firm’s assessment of Tesla’s current valuation and the steps you are taking to protect AFT members who are your clients and beneficiaries,” she wrote.

The AFT represents 1.8 million education, healthcare, and public sector workers. According to a union press release, AFT members’ deferred wages are invested in pension funds totaling an estimated $4 trillion, with a significant portion tied to Tesla shares.

Additionally, teachers and nurses have billions of dollars in their own savings invested in direct contribution pension plans managed by the asset firms addressed in the letter.

Shares in Tesla (Nasdaq: TSLA) are down about 23% year to date.