Tesla Voices Concerns Over Trump’s Trade Tariffs Amid Potential Retaliation

As trade tensions escalate, Tesla has expressed unease over the repercussions of Donald Trump's tariffs on imports, fearing that retaliation will harm U.S. businesses, including their own.

In a recent letter to U.S. trade representatives, Tesla raised alarms over the potential adverse effects of retaliatory tariffs resulting from the trade policies of President Donald Trump. The electric vehicle manufacturer, led by CEO Elon Musk—a known associate of Trump—asserted that while it advocates for fair trade, it is concerned about the disproportionate burden placed on U.S. exporters due to these tariffs. This warning coincided with a White House event where Trump declared his intent to purchase a Tesla, ostensibly in solidarity with Musk.

Despite the support Trump showed Musk, Tesla’s share price has witnessed a staggering decrease of 40% this year, leading some to speculate whether Musk’s close ties to the administration are damaging the brand. However, analysts attribute the decline more to production target challenges and decreased sales than to Musk's political affiliations.

Tesla's letter, though unsigned, highlighted the company's efforts to localize its supply chain to reduce reliance on international markets. Nonetheless, it acknowledged that sourcing certain components entirely within the U.S. remains a significant hurdle. The trade landscape remains precarious as Trump recently enacted a 20% tariff on imports from China, prompting retaliatory moves from Beijing, including increased levies on electric vehicles.

Moreover, additional tariffs on steel and aluminum imports have drawn threats of retaliation from Canada and the EU. The backlash against Musk has also taken a personal dimension, with protests erupting at Tesla showrooms tied to concerns about his role in the Trump administration as head of the Department of Government Efficiency (Doge). Earlier this week, Trump, in a striking comment during a White House event, claimed that anti-Tesla demonstrators would face severe consequences, branding them as domestic terrorists and arguing that their actions could harm an essential American company.