It seems clear that Trump's assertiveness on trade is net beneficial for Tesla, even though there could be some short-term dislocation impacts.
The context is that Trump announced a 25% tariff on steel and 10% tariff on aluminum imported into the United States. Model S and Model X primarily use aluminum, while Model 3 primarily uses a steel alloy. In addition, under a different mechanism, Trump has announced a 30% tariff on solar panels, with a related allowance on solar cells. All of these tariffs seem to be the introductory hand played by Trump in an attempt to balance U.S. trade somewhat, mostly with respect to China. In other words, we should not focus too much on the details of these individual announcements.
What could Tesla gain? Tesla's exports to China, its second largest market, are taxed at 25%. If Tesla decides to manufacture in China to avoid this tariff, it must have a local partner. China also is heavily subsidizing its solar panel and battery makers, which lowers prices for non-Tesla batteries and solar panels.
Full disclosure: I am a free trader, but don't mind a brushback pitch or two, a few hit batters, and a clearing of the benches every so often.
The context is that Trump announced a 25% tariff on steel and 10% tariff on aluminum imported into the United States. Model S and Model X primarily use aluminum, while Model 3 primarily uses a steel alloy. In addition, under a different mechanism, Trump has announced a 30% tariff on solar panels, with a related allowance on solar cells. All of these tariffs seem to be the introductory hand played by Trump in an attempt to balance U.S. trade somewhat, mostly with respect to China. In other words, we should not focus too much on the details of these individual announcements.
What could Tesla gain? Tesla's exports to China, its second largest market, are taxed at 25%. If Tesla decides to manufacture in China to avoid this tariff, it must have a local partner. China also is heavily subsidizing its solar panel and battery makers, which lowers prices for non-Tesla batteries and solar panels.
Full disclosure: I am a free trader, but don't mind a brushback pitch or two, a few hit batters, and a clearing of the benches every so often.