US President Donald Trump has imposed a 25% tariff on cars made outside the US, starting April 2.
This move aims to boost America’s manufacturing industry and generate $100 billion in revenue.
Elon Musk, CEO of Tesla, says his company will be affected significantly despite manufacturing 100% of its cars in the US. Musk wrote, “The tariff impact on Tesla is still significant.”
The tariffs will impact various automakers differently, depending on where they manufacture their cars. Here’s a breakdown:
- Tesla: 100% made in the US
- Ford: 77% made in the US, 21% in Canada and Mexico, and 2% elsewhere
- Other automakers: varying percentages made in the US, Canada, Mexico, and other countries
Legacy automakers, such as Ford and General Motors, will likely struggle to adapt to the new tariffs and may see a decline in profits. The US is the most profitable country for the auto industry, making this tariff a significant challenge.
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