- The Trump administration says imposing tariffs on trade partners is a way to shrink the US trade deficit.
- Tesla’s CEO Elon Musk has been a key Trump backer, but a trade war would raise costs for its cars.
- In a letter, the company urged the US government to ensure the trade war doesn’t “inadvertently harm US companies.”
Tesla has warned the Trump administration that it could bear the cost of the president’s attempts to impose so-called retaliatory tariffs on US trade partners.
In an unsigned letter uploaded to a regulatory docket on March 11, the automaker said a trade war could increase costs to manufacture its vehicles and lead other countries to slap tariffs on Tesla vehicles made in Austin or electronic equipment it makes in states such as California and Nevada.
“Past US special tariff actions have thus increased costs to Tesla for vehicles manufactured in the United States, and increased costs for those same vehicles when exported from the United States, resulting in less competitive international marketplace for US manufacturers,” the company wrote.
Elon Musk, Tesla’s CEO, has been named a “special government employee” who has been closely associated with Donald Trump’s drive to shrink and automate the federal government. The letter underscores how his political interests and his business interests could diverge.
Tesla’s share price has fallen by nearly half since its December peak. Musk said earlier in the week he was having a tough time running his businesses due to his involvement with the White House DOGE office.
“Tesla supports a robust and thorough process to gather information to ensure appropriate actions are taken to address unfair trade practices and which, in the process, do not inadvertently harm US companies,” said the letter, which was previously reported by the Financial Times.
The fact that the letter wasn’t signed may be unusual, but isn’t unprecedented for Tesla, which has previously submitted comments to the IRS without a signature at the bottom. Letters it has submitted to other agencies have included signatures.
Tesla, Musk, and the White House did not respond to Business Insider’s request for comment.
The letter was uploaded to a public comment portal for the US Trade Representative on March 11 by an in-house lawyer at Tesla. It is embedded below.
The letter was sent on the same day Trump invited Musk and a lineup of Teslas to the south lawn of the White House for a publicity event. Trump said he’d be buying a Tesla to show his support for Musk and his company after acts of dealership vandalism.
This story is developing.
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