Former Tesla CEO Elon Musk has emerged as the senior advisor to the second Trump administration. He’s done this so well that he’s given a record $290 million to ensure that Donald Trump retakes the White House. Musk to head the new Department of Government Efficiency (DOGE). His stated mission includes slashing federal cash, personnel, and abolishing or drastically shrinking multiple federal agencies and services.
On Wednesday, President Donald Trump announced plans to impose 25% tariffs on "all cars that are not made in the United States," a move that could have significant implications for automakers, including Tesla. Despite having assembly plants in Austin, Texas, and Fremont, California, it’s not easy for Tesla to source some parts domestically. Key elements such as headlamps, auto glass, brakes, body panels, suspension components, and even printed circuit boards often rely on overseas vendors. These suppliers are typically based in Mexico, Canada, and China.
Ever since the tariffs announcement came seemingly out of nowhere, domestic automakers have expressed serious concern. Tesla, joined by General Motors, Ford and Rivian, all of which were once in the EV business Tesla lauded, saw their stock values dip in response to the news. Tesla had asked USTR in the past to look more broadly at the consequences of addressing unfair trade practices. They highlighted the need to deploy tariffs strategically and judiciously.
Elon Musk of Telsa fame stood next to Donald Trump during the announcement. Trump has long admired Tesla’s styling, even before the angular, steel Cybertruck came to market. At the same time, Tesla is increasingly succumbing to competition as other automakers bring more fully electric models to market. Most importantly, BYD in China still isn’t approved to sell its electric buses to the United States.
In a show of support for Musk and his business, Trump declared on Truth Social his intention to purchase a Tesla vehicle. Tesla delivered at least five electric Tesla vehicles for Trump to inspect in the White House.