Baillie Gifford cuts Tesla stake to record low

Published: 2025-03-20 02:21:09 ET TSLA

BAILLIE Gifford has slashed its stake in Tesla to a record low as a major shareholder has called on Elon Musk (pictured) to step down as boss.

The Edinburgh-based investment manager first invested in Musk's electric car company in 2013 and has been a strong backer of the billionaire's firms ever since.

However, a spokesperson told City AM that Baillie Gifford has now reduced its stake to just 0.06 per cent of the company's shares, including its investment trusts.

"The recent challenge we've faced as Tesla shareholders is that the valuation of the company increased by more than half a trillion dollars towards the end of 2024 in the absence of any fundamental news," said a Baillie Gifford spokesperson.

Tesla's stock price jumped 120 per cent in the two months after the US the election, reaching a peak valuation of $1.7 trillion.

However, since then, it has more than halved, falling to a $728bn valuation and undoing all growth it had achieved since October.

"It is hard to think of a time in the history of the automotive industry where a brand has lost so much value so quickly," said Quilter Cheviot analyst Mamta Valechha.

Analysts have credited the fall to management distraction, negative brand sentiment and weak sales data, with particular attention paid to Musk's work with the US government and increasingly radical politics.

Meanwhile, Tesla sales have declined across the world, but especially in Europe, falling 45 per cent in January.