Tesla suspended on Friday new orders for the Model S and the Model X in China. According to the company’s website for the China market, customers can no longer acquire customized/new units but inventory vehicles only.
The move follows the recently escalated trade war between China and the United States. Earlier on Friday, Beijing announced it is raising tariffs to 125% on U.S. imports a day after the White House confirmed that the cumulative tariffs on China are currently at 145%.
Unlike the refreshed Model Y and the Model 3 sedan, these models are not manufactured in Shanghai’s Gigafactory, but in the U.S. plants.
The Elon Musk-led company launched both Model S and Model X in China in 2023. The sedan’s prices started at 789,000 yuan ($108,000) and the X model was priced from 879,000 yuan ($120,000).
China Auto Dealers Association analyst Li Yanwei told Reuters that China imported 1,553 Model X and 311 Model S throughout 2024.
On Friday morning, the models’ inventory on the Chinese website had already sold out in provinces like Beijing.
“The U.S. has arbitrarily imposed unilateral tariffs, seriously violating international economic and trade rules, as well as basic economic principles and common sense,” China’s Ministry of Commerce stated on Friday. “This has caused the current global economy, international markets, and the multilateral trade system to face severe shocks and turmoil. The U.S. should bear full responsibility for this.”
After Donald Trump announced a rate of 54% on imported products from China last week, the country has counteracted by raising duties, prohibiting exports of certain materials, and adding over a dozen U.S. companies to its blacklist.
The U.S. President paused tariffs for 90 days earlier this week, aiming at negotiations with other countries, causing U.S. stocks and futures to soar. However, it was clarified on Thursday that the pause did not apply to the 25% duty imposed on imported vehicles and auto parts.
Tariffs Impact
When considering Tesla’s Model 3 and Model Y, the Elon Musk-led company faces minimal impact in both China and the U.S. as its supply chain is highly localized with about 95% of parts coming from local suppliers.
As production of both the Model S and Model X only takes place in the U.S., Tesla’s margins on these models are highly affected by China tariffs.
Tesla has limited impact from the U.S. tariffs announced by Trump, as it produces most of its vehicles domestically. However, Musk stated two weeks ago that the company is not immune to the effects.
“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 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.”
The brand’s models are among the top 5 ‘Most-American made’ electric vehicles, according to a study published by Cars.com, contrary to what Trump’s top adviser Peter Navarro implied last week.
Refreshed Versions
The Model S sedan is currently selling at $79,000 in the U.S, while Model X’s prices start at $84,990.
In late February, Tesla‘s VP of vehicle engineering Lars Moravy hinted that the company is releasing a revamped version of the two models, as he stated that they are not being removed from the lineup, but updated later in 2025: “Just give it a minute, we’ll get there.”
Tesla delivered 336,681 vehicles globally in the first quarter, of which only 4% — 12,881 units — were Model S, Model X and Cybertruck. In China, the company sold 172,754 units in the first three months of the year.
