Tesla halts Model S and X orders in China amidst tariff tensions
Tesla has stopped accepting orders for the Model S and Model X in China. The decision comes amid rising trade tensions between the US and China. On Friday, China announced an increase in retaliatory tariffs on the US.
What do you need to know?
- Tesla suspended accepting new orders for the Model S and Model X in China. The decision was noticed on Tesla's Chinese website and on their WeChat account.
- China imposed a 125% tariff on American goods in response to tariffs introduced by the Trump administration, which may have influenced Tesla's decision.
- Tesla produces the Model 3 and Model Y in Shanghai. The cars are sold in China and exported to Europe, which constitutes the majority of the company's sales.
Why did Tesla halt orders?
Tesla, the American automotive giant, unexpectedly suspended accepting new orders for its Model S and X in China. According to information published by Reuters, the decision may be linked to escalating trade tensions between the US and China.
China imposed a 125% tariff on American goods, which is a response to tariffs introduced by the Trump administration.
What's next for the Chinese market?
Tesla did not provide an official reason for halting orders, but analysts suggest it could be related to rising import costs.
In 2024, China imported approximately 1,550 Model X and 310 Model S vehicles. The halt in orders could impact the company's financial results, especially since the Shanghai-produced Model 3 and Model Y make up the majority of Tesla's sales in China.
Trump imposes tariffs on China
On Wednesday, Trump announced a suspension of retaliatory tariffs for 90 days. However, this information did not pertain to China.
On Thursday, the White House announced that the retaliatory tariff rate was increased from 84% to 125%, which, combined with previous tariffs imposed by US President Donald Trump's administration, totals 145%.
