Elon Musk’s Tesla suspends orders for EVs in China
Tesla has suspended new orders for its Model S and Model X electric vehicles in China, a move directly linked to the escalating trade war started by US President Donald Trump.
The decision, which came hours after the US imposed substantial 145% tariffs on Chinese goods, marks a significant blow to Elon Musk’s electric vehicle giant.
The suspension of orders, evident on Tesla’s Chinese website and its WeChat mini-program, specifically targets the Model S and Model X, both of which are imported from the United States. While representing a small portion of Tesla’s Chinese sales (less than 5% in 2024), these models are now unavailable to Chinese consumers. Tesla’s Shanghai factory primarily produces the more popular Model 3 and Model Y vehicles.
Musk, who has cultivated a close relationship with Beijing due to China’s dominance in lithium battery and green energy production, now finds his company caught in the crossfire of geopolitical tensions. Tesla’s China sales reached a record high of over 657,000 cars in 2024, but the company has recently faced increased competition from domestic rivals like BYD, which surpassed Tesla in global revenues last year.
The order freeze coincides with a growing public rift between Musk and Trump’s trade advisor, Peter Navarro. Musk’s scathing remarks towards Navarro on social media, calling him “dumber than a sack of bricks” and a “moron,” underscore the tension surrounding the tariffs.
The impact of the trade war is already being felt by Tesla, with its share price plummeting by approximately 50% from its December peak. Musk has openly acknowledged the “significant” impact of the tariffs and has expressed hope for a trade agreement between the US and the EU. He has also reportedly urged President Trump to reverse the tariffs, citing the destabilizing effect on stock markets.
Furthermore, Tesla has faced consumer backlash due to Musk’s perceived alignment with Trump’s policies, with some customers boycotting the brand and others expressing their discontent through car stickers. This negative sentiment has contributed to Tesla’s recent sales decline, which saw its largest drop in over a decade earlier this year.
