Elon Musk has gambled Tesla’s future on the Cybercab — a small, autonomous vehicle intended to spearhead the automaker’s charge into the robotaxi business and give it a pathway for growth as other electric vehicle makers increasingly eat its lunch.
It was an already questionable move. And now, in a grim irony for Musk, it’s looking even dicier thanks to the Trump administration he helped usher into the White House with hundreds of millions of dollars in highly visible support.
As Reuters reports, Trump’s steep tariffs on Chinese goods have forced Tesla to suspend its plans to import parts for the Cybercab and its electric tractor unit, the Semi, from China.
While it’s unclear how long the suspension will last — or for that matter Trump’s tariffs, which have see-sawed back and forth — it could be a major disruption, given that the development of both vehicles already face significant hurdles.
Per the reporting, Tesla was scheduled to start receiving parts shipments over the upcoming months to start trial production of the Cybercab and Semi in October, with the goal of starting mass production in 2026.
Ironically, Tesla had been preparing for the tariffs for the past two years by sourcing more of its parts from North America, according to a Reuters source. It was even ready to eat the extra costs of the tariffs on China when they were still at 34 percent.
But that’s a rate firmly in the rear view mirror now. In the “Liberation Day” fallout, Trump raised the tariffs to 84 percent — then to 125 percent, then a staggering 145 percent, and now to a degree so high that the precise figure has become a bit hazy.
At its unveiling last October, Musk told investors that the Cybercab would bring trillions of dollars to the company. It would cost less than $30,000 and enter production in 2026. Both promises are being severely threatened by the tariffs.
The situation is more dire for the Semi, the development of which has faced repeated setbacks and is years behind schedule. After announcing a delay, the automaker said it would start deliveries in 2021. Since then, it has only produced a small number of the trucks for an even smaller group of customers.
The halt on the parts imports is the latest blowback that Tesla is facing from Trump’s aggressive economic policy towards China, which is the automaker’s second largest market and the largest market for EVs in the world. Last week, Tesla suspended orders for two of its vehicle models on its Chinese website as China raised retaliatory tariffs on US goods to 84 percent. Amid those fears, Tesla stock continued to dive.
There are signs that the punishing tariffs are forming a rift between Trump and Musk. On his website X, Musk raged against the president’s senior trade advisor Peter Navarro, who devised the tariff policy, calling him a “moron” and worse. Musk also made comments vowing his support for “free trade,” and personally tried to change Trump’s mind behind the scenes.
So far, there’re no clear signs of Trump relenting.
More on Tesla: Tesla Stock Hits Dreaded Death Cross
Source link
#Trumps #Tariffs #Wrecking #Elon #Musks #Hail #Mary #Save #Tesla
