The Trump tariff debacle continues and now companies are even more confused than before about the purpose of these and how they will impact their final line, making them even more insecure and paranoid about their standing, however, there is a piece of seemingly good news that will help some of the biggest companies in America, including Tesla.
Since most of the goods that are sold in the US are produced abroad, especially in China, the tariffs imposed by Donald Trump on this country were the main point of contention for many automakers and tech companies that had no ability to move production stateside and would be very negatively impacted by the increase in import prices.
While at first Trump seemed adamant that this was not a concern and that the “America first” policies were going to be applied across the board and companies were just going to move their manufacturing or pay the price, he seems to have had a change of heart, and many suspect the main culprits are Tesla CEO and head of DOGE Elon Musk and Apple CEO Tim Cook, who already got an exemption to tariffs during Trump’s first presidency.
The new tariff policy for companies like Tesla and Apple
The new directive that has come out of the White House seems to have given these tech and automation companies a big break, as they are now excluded not just from China’s ridiculous import fees (which are now up to 54%, but could be up to 104% if the threats Trump made come to fruition), but from the blanket tariff of 10% that he applied to all countries not specifically named in the original executive order.
This would mean that any goods that these companies produce in places like India or Taiwan are also safe from the tariffs and can continue to be imported into the US at the same price as before. For now.
Wedbush Securities analyst Dan Ives is, like many others, not impressed by this change in policy and called the announcement about the tech exclusions “the most bullish news we could have heard this weekend.”
In a scathing industry note he reviewed the situation but admitted that although “There is still clear uncertainty and volatility ahead with these China negotiations…. Big Tech firms like Apple, Nvidia, Microsoft and the broader tech industry can breathe a huge sigh of relief this weekend into Monday,” which is a good thing considering most of these companies had had their stock plummet significantly since the tariffs were announced, with Tesla being the most affected company.
But that is all apparently in the past. Especially for the electric vehicle manufacturer this change in politics is a good thing for them, as one of the most important features in their cars, the Flat-screen displays and integrated circuits are on the famous list of items now exempted from tariffs. This is especially important given the fact that Tesla vehicles all come with flat touchscreen displays, advanced onboard computers and mostly electric components that run the whole car, all of which are manufactured and installed in vehicles in different parts of Asia. Since every country had been targeted, the price of Tesla’s could have gone up even more than expected if they had had to pay the tariffs for all the incorporated accessories.
Since the tariffs seem to be in constant evolution and nothing seems set in stone, we do not know how other companies will be able to maneuver their production and import policies to try to keep the prices of their products at a reasonable level, but we will continue to report any changes that are announced by the White House.