The News
In an unsigned letter to US trade representative Jamieson Greer, Elon Musk’s Tesla warned that the Trump administration’s trade war could make the electric carmaker a target for retaliatory tariffs and could “inadvertently harm US companies.”
Tesla urged Greer’s office to “consider the downstream impacts of certain proposed actions taken to address unfair trade practices.”
Musk is the de facto head of the advisory Department of Government Efficiency, where he has overseen drastic cuts to the federal workforce that have become a defining feature of President Donald Trump’s first months in office.
SIGNALS
Complex supply chains leave auto industry vulnerable to tariffs
The automotive industry is particularly vulnerable to tariffs because of how internationally embedded its supply chains are, an expert from the Peterson Institute for International Economics told US commentator Ezra Klein: “You can have [a car part] criss-cross the border a multitude of times, and every time there will be a tariff,” she said, adding that bureaucratic hurdles make this near-impossible to avoid. Uncertainty over the Trump administration’s whipsaw approach to tariffs will place the automotive industry’s planning “in a virtual gridlock,” S&P Global wrote.
Consumer anger aimed at Musk rattles Trump
Protests targeting Tesla dealerships — some involving arson and gunfire— have spread across the US and to France and the UK as public opinion sours on Musk. Donald Trump weighed in this week, accusing demonstrators of “harming a great American company,” suggesting the attacks on his key adviser have left the US president rattled, a columnist argued in The Guardian: “To a president who sees everything in terms of making money, it’s consumers who matter,” she wrote. Falling shares in the carmaker could limit the tech billionaire’s future ambitions — “Tesla’s stock is Musk’s engine,” Vox wrote — though significant losses may matter less given his closeness to Trump and his sway in the federal government.
Tesla plots cheaper car in China in fight to compete
Tesla is planning to debut a cheaper version of its best-selling car in Shanghai as it seeks to compete with lower-cost Chinese-made EVs, Reuters reported on Friday. Tesla has lost ground in China as drivers turn to rival BYD and the market becomes increasingly saturated with local brands, which younger generations tend to prefer, The New York Times reported. BYD’s most affordable models are cheaper than Tesla’s in at least 10 non-Western countries, according to an analysis by Rest of World, and BYD’s global dominance looks set to continue: While Tesla is primarily focused on the US and Europe, BYD is expanding into Latin America and Southeast Asia.