Tesla sends warning letter to White House regarding tariffs
THE DETAILS …
Tesla, led by Elon Musk, has formally warned the Trump administration about the potential negative impacts of its aggressive tariff policies, highlighting the risk of retaliatory tariffs from other countries. In a letter to U.S. Trade Representative Jamieson Greer, the company expressed concerns that such measures could increase production costs for electric vehicles in the U.S. and harm American exporters, including Tesla. This warning underscores the broader anxiety among U.S. businesses about the economic fallout from escalating trade wars, particularly as Tesla faces the challenge of maintaining affordability amidst potential supply chain disruptions.
Recent developments have intensified scrutiny on Tesla’s position, as the company’s stock price has plummeted by 36% year-to-date, reflecting investor concerns over both the tariff threats and Musk’s polarizing political involvement. The letter, sent on March 11, was unsigned, reportedly due to internal fears of repercussions, and was uploaded to the USTR website by Tesla’s associate general counsel, Miriam Eqab. Despite Musk’s close alliance with Trump, including his role as head of the Department of Government Efficiency, Tesla’s public stance reveals a tension between corporate interests and the administration’s trade agenda, with the company pushing for careful consideration of “downstream impacts” on U.S. exports.
(see more details below)
The situation has been further complicated by external pressures, including a significant drop in Tesla’s European sales by 45% in January and protests targeting its American showrooms, partly fueled by backlash against Musk’s political actions. Meanwhile, Trump has publicly supported Tesla, hosting a high-profile event at the White House on March 11 to showcase its vehicles and announcing his purchase of a Tesla Model S, which briefly boosted the company’s stock by 3.8% that day. However, this support contrasts with broader market trends, as Wall Street indices like the S&P 500 have fallen over 10% from their recent highs, signaling widespread economic unease tied to Trump’s tariff policies.
MY TAKE: The tariffs are going a bit too far. Would prefer they be rolled out more conservatively and with less abrasive press releases. The tariffs done correctly can be awesome for America, done abruptly — like they have been lately — it will hurt everyone.