SPINNING HIS WHEELS

Elon Musk Warns Tesla Won’t Escape ‘Unscathed’ From Trump’s New Tariffs

Financial indicators suggest the Musk-led carmaker will get off lightly compared to its competition under the president’s auto tariffs.

Elon Musk said President Donald Trump’s steep new tariffs on cars and auto parts will have a “significant” impact on Tesla, even though financial indicators suggest other carmakers will be dealt a bigger blow.

“To be clear, this will affect the price of parts in Tesla cars that come from other countries,” the Tesla CEO wrote on his social media platform X. “The cost impact is not trivial.”

Trump announced Wednesday that he was imposing a 25 percent tariff on all cars not made in the United States. The levy will apply to all passenger vehicles and light trucks imported to the U.S., in addition to crucial components like engines and transmissions.

He said the U.S. will begin collecting the auto tariffs on April 3.

Tesla has run into significant hurdles in recent weeks: Global sales have slumped dramatically amid increased competition in the electric vehicle market and controversy over Musk’s role as cost-cutting czar in the Trump White House.

The company has also been subject to nationwide protests and a string of vandalism at dealerships, which Trump administration officials have likened to “domestic terrorism.”

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Tesla’s shares are down 31 percent so far in 2025, far worse than the blue chip S&P 500 stock index, which is down 3 percent.

However, under Trump’s new tariff regime, the company will get off relatively light.

That’s because Tesla manufactures all the cars it sells in the U.S. at its large production facilities in California and Texas.

As well, a majority of the components Tesla uses in its cars originate in the U.S.—between 60 percent and 75 percent, according to a 2024 regulatory filing.

The only major U.S. automaker that approaches Tesla’s insulation from global supply chains is Ford, which makes 79 percent of the cars it sells in the U.S. on domestic soil.

Meanwhile, with almost half of new passenger vehicles sold in the U.S. last year were assembled outside the country, according to an S&P Global Mobility analysis, other carmakers are set to feel the brunt of the tariffs.

That was felt immediately on markets Thursday.

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In Japan, Honda shares closed down 2.5 percent, Nissan 1.7 percent, and Toyota 2 percent. In South Korea, Hyundai fell 4.3 percent and Kia 3.5 percent.

In Europe Mercedes-Benz shares shed 3 percent and BMW and Volkswagen both more than 2 percent in afternoon trading.

Luxury automakers Porsche, Ferrari, and Aston Martin were also down.

But Trump’s latest move, designed to penalize foreign automakers while thumbing America’s nose at longtime trading partners, also immediately unleashed pain on domestic automakers.

Shares in Detroit’s big three stumbled out of the gate Thursday morning on the New York Stock Exchange: General Motors tumbled over 7 percent in early trading, Chrysler parent Stellantis fell 4 percent, and Ford dropped.

Tesla, meanwhile, was up 2 percent.

Musk tried to push back against the idea that his company had an advantage.

“Important to note that Tesla is NOT unscathed here,” he wrote in a post on X, replying to a user who posted a visualization showing Tesla’s relatively limited exposure to tariffs compared to other automakers. “The tariff impact on Tesla is still significant.”

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