Elon Musk’s Tesla Inc has cautioned that retaliatory tariffs against US manufacturers could negatively impact its operations and urged the US government to take a measured approach in its trade policies.
Departure from Musk’s position
The stance is a sharp departure from Tesla chief executive Elon Musk’s close alignment with President Donald Trump and his policies, from which perhaps Musk thought his companies were exempt.
The company is facing heat on a number of fronts, with the company’s stocks currently tanking and erasing any gains made following the election of Musk’s chosen president.
European sales dropped 45% in January, according to the European Automobile Manufacturers’ Association.
On Thursday, Tesla shares plummeted as much as 11%, which wiped $73 billion off the value of the company.
And Musk’s woes are not merely financial. Citizens concerned about the direction of the US government under Trump and his defacto deputy, Musk, have been protesting outside Tesla dealerships in the US and around the world.
In a letter dated March 11 to US Trade Representative Jamieson Greer, Tesla representatives called for a careful assessment of proposed measures to address unfair trade practices.
“As a US manufacturer and exporter, Tesla encourages USTR to consider the downstream impacts of certain proposed actions taken to address unfair trade practices,” the letter said.
Tesla said it supported fair trade but warned that previous US tariff policies had led to immediate counter-measures from targeted nations, including increased tariffs on electric vehicles (EVs) exported from the US.
Exports affected too
The letter also highlighted the impact of past tariff actions on the cost of US-manufactured vehicles when exported abroad.
The company urged the Office of the US Trade Representative to evaluate ways to mitigate these consequences in future policies.
It also mentioned its concerns regarding supply chain limitations, particularly in the EV and lithium-ion battery industries, noting that some components are not readily available within the US.
Tesla, which employs over 70,000 people across multiple US facilities, manufactures EVs and lithium-ion battery cells at its Fremont, California, plant.
It also operates facilities in Texas, Nevada, New York, Minnesota and Michigan.