Elon Musk’s Tesla says it could be targeted by retaliatory tariffs

New York (CNN) — Tesla, the electric car company run by Elon Musk, said this week that retaliatory tariffs against US manufacturers could harm its operations and that the US should carefully consider its trade policies, a break from Musk’s ally President Donald Trump.

In a March 11 letter to US Trade Representative Jamieson Greer, company representatives wrote: “As a U.S. manufacturer and exporter, Tesla encourages USTR to consider the downstream impacts of certain proposed actions taken to address unfair trade practices.”

“While Tesla recognizes and supports the importance of fair trade, the assessment undertaken by USTR of potential actions to rectify unfair trade should also take into account exports from the United States,” the letter said.

It warned that past US tariff actions have resulted in “immediate reactions” by the targeted countries, such as increased tariffs on EVs imported into those countries. The letter is unsigned.

Musk’s Tesla has basked in the limelight under the Trump White House, which has put tariffs at the forefront of its economic policy. On Tuesday, the president posed in front of a fleet of Teslas, saying he would purchase one full price. As he spoke, Trump was holding what resembled a Tesla showroom pitch with a list of vehicle prices, according to a photo from Getty Images.

But Tesla shares have been in a sharp slump recently, erasing their gains since Election Day. The company’s European sales dropped 45% in January, according to the European Automobile Manufacturers’ Association. And despite his outsized role in the government, Musk has become a polarizing political figure. Tesla shares closed down 3% Thursday.

Past tariff actions by the US, Tesla wrote, increased the cost of US-manufactured vehicles for the company and when those vehicles are exported out of the US.

The Office of the US Trade Representative should investigate ways to avoid these pitfalls in future actions, the letter added.

The letter also said that trade policy should consider the “limitations in the domestic supply chain” regarding EVs and lithium-ion batteries. Some of these items are simply impossible to source within the US, the letter argued.

Tesla operates numerous US facilities that altogether employ over 70,000 people, according to the company. Its Fremont, California, factory manufactures vehicles as well as lithium-ion battery cells, and the company also has facilities in Austin, Texas; Sparks, Nevada; Buffalo, New York; Brooklyn Park, Minnesota; and Grand Rapids, Michigan.

CNN has reached out to Tesla for comment.

The-CNN-Wire
™ & © 2025 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.