Tesla could be handed a major advantage by Donald Trump’s 25% tariffs on imported cars in a possible win for Elon Musk. The American electric car giant produces 100% of its U.S. stock in California and Texas. Musk’s factories mean Tesla will not be subjected to tariffs on vehicle imports like many of their rivals.
Tesla is understood to be losing market share to models such as Ford’s Mustang Mach-E which is built in Mexico. Tariffs on imports into the United States could see prices of competitors rise with Tesla possibly able to benefit.
Analysis from VisualCap showed Ford makes around 77% of its models sold in the U.S. inside the country. Meanwhile, 21% are produced in Canada or Mexico with 2% elsewhere.
Stellantis only made 57% of U.S. stock in the country with Nissan (52%), General Motors (52%) and Toyota (48%) also behind.
However, the Tesla boss didn’t see it so clearly and took to social media to clarify his position.
Tesla will still be impacted when tariffs are slapped on car parts such as batteries and raw materials in May with production costs likely to increase.
In a statement on X, Musk confirmed that Tesla would not be “unscathed” by the decision despite his closeness to the current administration.
The Tesla boss said: “Important to note that Tesla is NOT unscathed here. The tariff impact on Tesla is still significant.”
Elon later added: “To be clear, this will affect the price of parts in Tesla cars that come from other countries. The cost impact is not trivial.”
However, U.S President Donald Trump confirmed Musk had not sought to use his influence to gain a competitive advantage.
In a media briefing in the Oval Office, a journalist asked the President whether Elon Musk had advised on introducing car tariffs.
Mr Trump quickly responded: “No because he may have a conflict so we don’t talk. Elon’s amazing. He’s never asked me for a favour in business whatsoever. I’m actually a little surprised by it.
“I might do it, I might not do it, I do what’s right and he would want me to do what’s right. He’s a patriot.
“I’ve never had Elon come and say would you do me a favour with the mandate or the electric mandate or anything? He’s never asked me for anything.”