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A long-term Elon Musk backer is cashing out of Tesla — and cutting its SpaceX exposure
Scottish Mortgage Investment Trust is selling its Tesla shares after deciding that the company’s share price already reflects much of its potential in autonomous driving and robotics. The trust also cited growing competition in Tesla’s core car business, especially in China.
The trust said its investment, first made in 2013, had returned 13 times the capital invested. Tesla and SpaceX shares fell about 11% and 9% on Thursday, respectively, leaving their combined market value more than $420 billion below Tuesday’s close, amid concerns that Elon Musk’s companies could face congressional scrutiny and tighter regulation. Scottish Mortgage is among several UK investment trusts that backed SpaceX early; another Baillie Gifford trust, Edinburgh Worldwide, faced an activist campaign in 2025 in which its SpaceX holding became a point of dispute.
In short
- Scottish Mortgage is selling its Tesla shares after a 13-fold return.
- It cited valuation concerns and tougher competition, especially in China.
- Tesla and SpaceX lost a combined $420 billion in market value since Tuesday.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Selling Tesla and reducing SpaceX exposure can be seen as prudent stewardship: Scottish Mortgage has earned a substantial return, and its judgement that Tesla’s price already assumes considerable success in autonomy and robotics reflects the risk that future growth may not meet high expectations. Competition in China and possible regulatory scrutiny also give investors reason to reassess how much risk to carry in companies closely associated with Musk.
The case against
Continuing to hold the shares could be justified by the possibility that autonomy, robotics and SpaceX’s longer-term prospects still have room to create substantial value. A sharp fall linked partly to political and regulatory concerns may not alter those prospects, while selling after a successful long-term investment could mean giving up further gains if the companies deliver on their ambitions.