Tesla has halted orders in China for two models previously imported from the US in response to the imposed tariffs due to Donald Trump’s trade war.
The company, led by Trump’s close ally Elon Musk, has removed the “Order Now” option for the Model S Saloon and Model X Sport Utility vehicles.
The reasons for these changes were not disclosed by Tesla, but they coincide with the escalating trade tensions between the US and China. As a result of the tit-for-tat tariff increases, the cost of imported vehicles from the US to China has become significantly higher compared to locally produced cars.
New orders for these models are no longer available on Wechat, a popular Chinese social media platform, according to Reuters. The “Order Now” button on Tesla’s US website for the Model S and Model X has been replaced by “available cars,” with some vehicles being accessible to Chinese buyers.
Since 2020, Tesla has been manufacturing Model 3 and Model Y cars at a large factory in Shanghai, reducing the impact of customs duties. However, the company’s supply chain may still be affected due to the trade tensions between the two countries.
Elon Musk, a key figure in the Trump administration, has been advocating for lower tariffs, which contradicts the policies implemented by Trump. This discrepancy in views could potentially impact Tesla’s operations and sales.
Recently, Tesla warned the US government about the potential negative effects of tariffs on American businesses. This development poses a significant economic challenge for Tesla, particularly in the European market where demand is declining.
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Analysts suggest that Tesla, despite its high market value, is currently undervalued and facing a significant crisis that may require Musk to distance himself from the Trump administration.
Tesla has been contacted for comment.
Source: www.theguardian.com
