Tesla Pauses Model S and Model X Orders In China As Tariffs Take Hold

Due to its U.S.-heavy oper Add Anchor text here ations, Tesla is expected to weather the tariff storm better than other automakers, but reciprocal actions from the Chinese government have caused some headaches for the American company. Tesla recently stopped taking new vehicle orders for the Model S and Model X in China, a move that follows China’s announcement that it would enact 125 percent tariffs on imported U.S. goods starting April 12.

President Trump announced a 90-day pause on many tariffs, with the exception of those placed on China and some other imports, including autos. The latest “upgrades” to the U.S.’ tariffs on China bring the total to a 145 percent levy on Chinese imports.

The Model S and Model X are not Tesla’s volume leaders in China, as it produces the Model 3 and Model Y locally. Cutting the two more expensive models, which are made in California, wouldn’t dent Tesla’s Chinese sales numbers in any significant way, but the move doesn’t help the automaker gain any ground in its fight against homegrown companies in the country.

China’s BYD has taken over global markets and is the country’s top-selling car brand, outpacing Tesla’s popular Model Y in many regions. More than 20 percent of Tesla’s revenue came from China last year, making it an essential market for the brand, but it’s hard to see how it will overcome the national pride and significant government backing that local Chinese brands enjoy.

[Images: Tesla]

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