Tesla is not spared from Donald Trump’s sanctions!

This page is translated from the original post "Tesla n’est pas épargnée par les sanctions de Donald Trump !" in French.

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Tesla Model Y Chine

Elon Musk confirmed that Tesla will not emerge unscathed from the new tariffs imposed on the automotive sector by his good friend Donald Trump.

On April 2, the Trump administration will implement a 25% tariff on all cars and light trucks assembled outside the United States. These taxes will also apply to foreign auto parts, except those from Canada and Mexico, which are exempt until May 3 as part of the USMCA agreement.

Tesla shareholders saw an advantage for the brand, which assembles all of its vehicles sold in the United States domestically. However, Elon Musk clarified this enthusiasm on X by responding to a post: “It’s important to note that Tesla is NOT spared. The impact of tariffs on Tesla remains significant.”

Indeed, although Tesla claims to produce the “most American” vehicles, a significant part of its components come from abroad, notably from China. Additionally, Tesla imports steel and aluminum from Mexico and Canada, which are also subject to these taxes. Up to a quarter of the parts needed for Tesla production in the United States come from Mexico, and an undisclosed portion comes from Canada. The company also manufactures some of its production equipment in Canada. Besides the fact that some customers will discover that Teslas are not 100% American, these new taxes will make producing a Tesla more expensive.

The myth of the 100% American Tesla broken

These tariffs will have repercussions for Tesla and the entire American automotive sector, leading to increased production costs and higher sales prices, making it more difficult for consumers to purchase vehicles, including Teslas. The U.S. administration plans to determine, within a month, the exact share of components made in the United States to exempt those parts from taxes. However, this complex task seems unrealistic to accomplish in such a short timeframe.

Furthermore, retaliatory measures could target Tesla, especially due to perceived relations between Musk and Trump. These tariffs, far from favoring anyone, are likely to disrupt the entire North American supply chain and weaken an already fragile industry.

READ ALSO: Trump strikes a blow to European car industry!

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