Tesla Warns Federal Government of Harm From Retaliatory Tariffs Amid Trade War
The company is asking the Trump administration to consider the impacts of any actions taken to address unfair trade practices.
Elon Musk’s Tesla has warned it’s at risk of being negatively affected by potential retaliatory tariffs against American manufacturers in response to President Donald Trump’s levies on imports from other nations.
“While Tesla recognizes and supports the importance of fair trade, the assessment undertaken by USTR of potential actions to rectify unfair trade should also take into account exports from the United States,” the letter stated. “U.S. exporters are inherently exposed to disproportionate impacts when other countries respond to U.S. trade actions.”
The letter from Tesla said that past trade actions by the U.S. government had resulted in “immediate reactions by the targeted countries,” including increased tariffs on EVs imported into those countries, as well as increased costs to Tesla for vehicles made in the United States.
Such actions have also led to higher costs for those same vehicles when exported from the United States, which in turn has resulted in a less competitive international marketplace for U.S. manufacturers, Tesla said.
The letter asked USTR to investigate ways to avoid such pitfalls for future actions.
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“Tesla supports a robust and thorough process to gather information to ensure appropriate actions are taken to address unfair trade practices and which, in the process, do not inadvertently harm U.S. companies,” the letter stated.
In addition, Tesla warned that future trade policy actions should take into consideration ongoing limitations in the domestic supply chain. Even with aggressive localization of the supply chain, “certain parts and components” are difficult or impossible to source domestically, it said.
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The automaker added that it supports a process by USTR to further assess domestic supply-chain limitations to ensure that U.S. manufacturers are “not unduly burdened by trade actions that could result in the imposition of cost-prohibitive tariffs on necessary components, or other import restrictions on items essential to support U.S. manufacturing jobs.”
“Trade actions should not (and need not) conflict with objectives to further increase and support domestic manufacturing,” the letter concluded.
It is not clear who at Tesla wrote the letter—which is unsigned, but is on a company letterhead—or if Tesla CEO Elon Musk is aware of it.
Musk heads up the Department of Government Efficiency (DOGE), which has been tasked with slashing federal spending.
The Epoch Times has reached out to Tesla for comment.
The letter from Tesla comes as the Trump administration has imposed an additional 20 percent tariff on all Chinese imports, prompting Beijing to respond with retaliatory levies of 10–15 percent on certain U.S. imports, along with a series of new export restrictions for designated U.S. entities.
Canada and the European Union have also vowed to respond with counter measures after Trump’s 25 percent tariffs on all steel and aluminium imports went into effect this week.
The decline sliced more than $125 billion off the company’s market value, though Tesla stock has since rebounded slightly and is currently trading just over $240 a share.
On March 11, Musk joined Trump at the White House as the latter shopped for a Tesla in a show of support for the vehicle maker. Asked by reporters whether he believed his purchase might help Tesla’s stock, Trump said: “I hope it does.”
Reuters contributed to this report.
