The EV manufacturer joins other industry players in expressing concern that the developing trade war will result in increased expenses, manufacturing delays, red tape, and higher consumer pricing.
Tesla, run by Donald Trump cheerleader Elon Musk, has warned US officials it risks being exposed to “disproportionate” retaliatory tariffs under the president’s escalating trade war.
The electric automaker raised the matter in a letter to the US Trade Representative’s (USTR’s) Office on the same day that President Trump purchased a Tesla car in a show of support for his close ally following a carnage in the company’s stock.
Investor concerns, primarily related to the trade war, have driven Tesla’s market value down 50% from its December peak, a loss of over £800 billion.
The reaction against the trade war grew this week, when Tesla experienced its largest daily loss in five years, as part of larger stock market declines on fears that US consumers and businesses are now facing a recession.
Market observers have attributed Tesla’s falls to domestic discontent over Mr Musk’s work in government to reduce its size through leadership of the so-called Department of Government Efficiency.
Tesla’s letter was one of many from firms concerned about rising prices and red tape.
The unsigned Tesla document emphasized the importance of ensuring that the Trump administration’s trade policies do not negatively impact US companies.
Tesla stated that it wished to prevent retribution of the kind it suffered in previous trade battles, which resulted in higher levies on electric vehicles imported into nations subject to US tariffs.
Canada and the EU are among the countries that have responded with counter-measures after the United States imposed tariffs on all steel and aluminum imports this week.
“US exporters are inherently exposed to disproportionate impacts when other countries respond to US trade actions,” Tesla wrote in his resignation letter.
“For example, past trade actions by the United States have resulted in immediate reactions by the targeted countries, including increased tariffs on EVs imported into those countries.”
Mr Trump is considering putting substantial tariffs on vehicles and parts manufactured around the world in early April.
Such duties were previously limited to Canada and Mexico, but were later suspended for four weeks following objections from US automakers.The president has said they will return on 2nd April, alongside “reciprocal” tariffs which are widely expected to hit the European Union for the first time.
Tesla’s letter warned that protectionist policies designed to bolster US manufacturing and jobs were further harmful as “certain parts and components are difficult or impossible to source within the United States”.
It called for a phased approach to allow more time to bolster supply chains.”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 electric vehicle producer said.