Back in May, Future Fund Managing Director Gary Black disclosed in a post on X that his investment firm had sold its remaining stake in Tesla (TSLA), saying the stock’s valuation had become “disconnected from underlying fundamentals.”
Getting asked by a few followers today. Posted on Subscribers early this morning.
undefined Gary Black (@garyblack00) May 28, 2025
Yesterday, we sold the remainder of our $TSLA position at $358/share. This is the first time since 2021 we have not owned TSLA. As in late-November, which is the last time we reduced our TSLA… pic.twitter.com/hGvtja4RTR
The fund exited when Tesla was trading at $358, roughly 6% above today’s price. It marked the first time Future Fund had been out of Tesla entirely since 2021.
Black pointed to the company’s stretched valuation as the primary red flag. At the time, Tesla was trading at a price-to-earnings ratio of 188x while earnings were down 5% in a single week and off 40% year-to-date.
Weak deliveries, including poor April results, were dragging forecasts lower.
Future Fund’s outlook was even more bearish than Wall Street consensus. Black projected Q2 deliveries would fall 12% and full-year volumes would drop 10%, compared with Street estimates of a 7% Q2 decline and a 5% annual drop.
The automaker’s actual Q2 deliveries came in worse still, sliding 13.5%.
Robotaxi doubts
Unlike some bullish analysts, Black wasn’t sold on Tesla’s long-awaited robotaxi launch in June. He described the risk/reward of the Austin pilot program as “asymmetrical to the downside.”
He also warned that Tesla’s promised affordable vehicle, due in July, risked being a stripped-down Model Y priced lower through cost-cutting rather than a true new product that could expand the total addressable market.
That concern looked prescient after Tesla launched a six-seat Model Y in China this month, a variant CEO Elon Musk said may “not ever” come to the U.S. because of the push toward full self-driving.
“This variant of the Model Y doesn’t start production in the US until the end of next year,” Musk wrote in a post on X.
What would bring him back
In a fresh post Friday, Black said Future Fund is “not looking to re-enter anytime soon,” pegging his re-entry target at $220–$240. He outlined five conditions that would make Tesla investable again:
- Prove robotaxi autonomy — Remove safety monitors to show 99.9% efficacy and true unsupervised driving.
- Launch a new affordable EV — Price it in the $30K–$35K range but as a distinct form factor, not a cheaper Model 3 or Y.
- Introduce a smaller pickup — Around $50K, while ideally scrapping the money-losing Cybertruck.
- Roll out robotaxis nationally — Which would require Trump’s administration to streamline approvals beyond today’s patchwork of state rules.
- Go global with advertising — Educate consumers that Tesla vehicles already offer autonomous capabilities.
“A cheaper scaled-down version of Model Y or 3 doesn’t work for us… which failed as a strategy in 2023–2024,” Black said.
For now, Tesla remains on his sell list. The stock is down 15.8% year-to-date, which is, in Black’s view, a reflection of hype colliding with fundamentals.
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