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Tesla Warns Trump Administration of Tariff Risks to Business

The electric carmaker cautions that retaliatory tariffs could raise production costs and hurt competitiveness abroad.

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Tesla said in its letter that it supports fair trade,
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Overview

  • Tesla sent an unsigned letter to U.S. Trade Representative Jamieson Greer warning that President Trump's trade policies could harm its business by triggering retaliatory tariffs from other countries.
  • The company highlighted that certain essential components, such as lithium and cobalt, are difficult to source domestically, making localization of supply chains insufficient to avoid these impacts.
  • Tesla's letter expressed concern that higher production costs in the U.S. could make its electric vehicles less competitive in international markets.
  • The letter comes despite CEO Elon Musk's close relationship with Trump, underscoring the potential business risks posed by the administration's trade policies.
  • Separately, Tesla is reportedly planning a lower-cost version of its Model Y in China to compete with affordable local EV brands, though this remains unconfirmed by the company.