President Trump is hitting 25% tariffs for all imported cars in the United States, including by our near -North America’s near neighbors. It has also set a 25% fee in some parts used for car construction. It is a decision that is likely to overload the cost of new and used cars, but it is also a gift to Tesla, the company led by Elon Musk, its biggest financial supporter in the presidential election.
The new tariff regime comes at a good time for Tesla. The company is dealing with the consequences of the Musk’s promotion of the far-right ideology and its involvement with the government’s unprofitable department, which has sparked protests around the world. Tesla has recently relied on promotions and price reductions to raise sales, and yet she still sold less EV in 2024 than in 2023 and is at a approximate start in 2025.
The new tariffs can shift that calculation, at least in the US Tesla builds all its cars intended for the North American market in the SH.BA factories in Fremont, California and Austin, Texas. This means that none of the cars he sells in the US will be subject to 25%vehicle import tax.
Tesla imports about 20% to 30% of the ingredients used to build those machines in order to cause headaches. Musk admitted to X that Tesla is not “unsafe” from these fees and claimed that they would have a “significant” impact. But the company’s long effort to create local supply chains near its factories is now being rewarded.
Basically every other car is in a worse position than Tesla, and the fees will particularly affect the competitive EV. About 80% of the Ford cars sells in the US are built inside the country. But this makes Mustang Mustang all-electric and the popular (and much more affordable) receiving truck Maverick Hybrid in Mexico.
General Motors, meanwhile, builds his blazer and equinox in Mexico. Hyundai has found growing success with his electric vehicles in the US market, but almost all of them are built in South Korea.
Like Tesla, electrical automobiles raised like Rivian and Lucid Motors will not have to worry about the import fees of the vehicle because they make their EVs in Illinois and Arizona, respectively. Like Tesla, they import portions that will undergo tariffs – but they are in a worse position to absorb those costs as both companies are still losing buckets in whatever they sell.
This creates a scenario where other EVs can see that the price rises greater than any tesla can apply. This price sharing can become even more of a help for Tesla when it comes out of its mysterious low-cost EV this year-something the company has said will happen in the coming months.
Of course, Trump announced these fees after a few weeks Waffling if he would implement them in the first place. The president has claimed that these will be “permanent”. But like many other things he proposes, this can always change.
