Written by Cláudio Afonso | LinkedIn | X
US President Donald Trump said Wednesday his administration will impose a 25% tariff on all foreign-made cars, a move that could reshape the country’s auto supply chain and pressure global automakers with overseas production.
While General Motors, Ford Motor Co. and Stellantis are much more exposed to the new trade measure, Tesla faces a more limited direct impact, as it manufactures all of the vehicles it sells in the U.S. domestically. Still, CEO Elon Musk warned that the company would not be spared as some parts are imported.
“To be clear, this will affect the price of parts in Tesla cars that come from other countries. The cost impact is not trivial,” Musk wrote Wednesday on X. In a separate post, he added: “Important to note that Tesla is NOT unscathed here. The tariff impact on Tesla is still significant.”
Tesla ranked first in the 2024 “American-Made Index,” with the Model 3 Performance, Model Y, Cybertruck and Models S and X occupying the top four positions.
Tesla’s entire U.S. sales volume comes from vehicles assembled domestically, giving it one of the highest “Made in America” footprints among automakers. By contrast, Ford manufactures 77% of its U.S.-sold vehicles in the country, with 21% coming from Canada and Mexico and 2% from other regions. GM is at 52% U.S., 30% Canada and Mexico, and 18% other.
Stellantis assembles 57% of its U.S.-sold vehicles in the United States, 39% in Canada and Mexico, and 4% elsewhere. Nissan and Toyota build 52% and 48% of their U.S.-sold cars domestically, respectively.
Kia sources only 33% of its U.S. lineup from U.S. plants, with 59% coming from other regions. Volkswagen has the lowest U.S. share among major brands at 21%, with the remainder sourced from Mexico, Canada, and beyond.
“What we’re going to be doing is a 25% tariff on all cars that are not made in the United States,” Trump said at a press conference. “Business is coming back to the United States so that they don’t have to pay tariffs. This will continue to spur growth like you haven’t seen before.”
Auto stocks slid Wednesday ahead of the announcement, which came after markets closed. Tesla fell as much as 5.5% intraday before paring losses. Rivian Automotive Inc. and Lucid Group Inc. dropped 2% and 3%, respectively. Tesla was up about 1% in pre-market trading Thursday.
