Tesla Shares Plummets by 5% Amid Trump’s China Tariff

Following President Donald Trump’s announcement of plans to impose significant tariffs on imports from China, Canada, and Mexico, Tesla’s stock plummets around 5% on Monday, closing at $383.68.

Declining Tesla vehicle registrations in France, Sweden, and Norway also had a negative impact on the stock.

Apple’s stock saw the next-largest decline, falling more than 3%, while Tesla’s shares plunged more than their mega-cap counterparts.

Over the weekend, President Donald Trump imposed 10% tariffs on goods coming from China, where Tesla makes almost half of its cars.

Although the supply chains of all automakers will undoubtedly be impacted by the tariffs, Tesla is able to avoid some of the difficulties that other manufacturers of electric vehicles face because it has factories in the United States, Berlin, and Shanghai.

Chief Financial Officer Vaibhav Taneja stated on last week’s results call that if the new administration imposes tariffs, Tesla’s profitability may suffer.

“Over the years, we’ve tried to localise our supply chain in every market, but we are still reliant on parts from across the world for all our businesses,” Taneja said.

He said the “imposition of tariffs” would “have an impact on our business and profitability.”

Regarding the decline in European EV registrations, France, one of the continent’s biggest EV markets, saw the biggest decline.

According to figures monitored by the industry organisation PFA, or Plateforme Automobile, Tesla registrations there decreased 63% in January compared to the same month the previous year.

Compared to France’s overall vehicle sales and the reduction in electric cars, that was a far greater drop.

Sales of Tesla fell 44% in Sweden and 38% in Norway in January.

Along with the tariffs and the news of declining registrations, Tesla reportedly reduced lease prices for its base Model 3 sedan and unpainted steel Cybertruck automobiles over the weekend, according to ads for customers in the US.

In a post on social networking platform X, an independent researcher who posts his Tesla predictions on Patreon under the handle “Troy Teslike” stated that he only anticipates Tesla selling roughly 21,000 Cybertrucks in 2025.

Wall Street analysts estimate 65,000 Cybertruck sales in 2025, but I expect 21,000 units.

Deliveries were 34,426 units in 2024. However, this included many buyers who had been waiting since the reveal event in November 2019.

The order backlog is gone. Tesla ended 2024 with…

— Troy Teslike (@TroyTeslike) February 2, 2025

“The order backlog is gone,” he wrote. “Tesla ended 2024 with 10,600 unsold Cybertrucks because of too much production and low demand. The backlog dropped to zero on November 24, 2024, when Tesla’s order page in the US showed that customers could order and take delivery of a Cybertruck on the same day.”

Elon Musk, the CEO of Tesla, was a significant supporter of Trump’s presidential campaign, giving $290 million to Republican organisations and candidates in 2024, the majority of which went towards getting Trump returned to the White House.

Additionally, Musk recently endorsed the far-right Alternative for Germany (AfD) party in Germany.

Tesla’s reputation and brand value have suffered as a result of Musk’s political activism and inflammatory remarks.

Brand Finance, a consultancy organisation, estimates that Tesla’s brand worth dropped by 26% in 2024.

CNBC