Here’s Where Tesla Stands Amid Auto Tariffs: ETFs in Focus

On Wednesday, President Trump announced a 25% tariff on auto imports to the United States.The tariffs apply to all cars and light trucks manufactured outside the United States, as well as certain auto parts.

The automaker market, both domestic and international alike, reacted negatively to the announcement, with analysts raising serious concerns about the potential fallout from the tariffs. Industry experts expect the tariffs to force automakers to significantly curb U.S. car production and add thousands of dollars to new car prices.

However, Tesla TSLA emerges as a likely winner amid the tariff chaos.

Tesla’s localized manufacturing, with all vehicles sold in the domestic market produced exclusively at its facilities in the United States, positions it as a relative winner among its peers. Compared to Tesla,about 77% of Ford Motor’s F vehicles are manufactured in the United States, followed by Stellantis at 57%, and both Nissan and General Motors GM at 52%.

According to Yahoo Finance, while Tesla operates gigafactories in China and Germany, none of the EVs produced at these facilities are sold in the United States. While Tesla does import some components, the figure remains relatively low compared with its peers, making the company less reliant on foreign components than other automakers in the U.S. market.

Per an analyst at JPMorgan, as quoted on Forbes, sourcing approximately 40% of its vehicles from Canada and Mexico, GM could face a $14-billion hit to its earnings due to the new tariffs, making it the most vulnerable.

As quoted on Forbes, Deutsche Bank forecasts that Tesla would need a 1.8% price increase to offset the costs of the tariffs, significantly lower than the 5.8% or more price hikes required for Ford, General Motors and Stellantis.

Per President Trump, as quoted on Reuters, the auto tariffs could be neutral or even beneficial for Tesla, emphasizing that Tesla CEO Elon Musk did not provide him with any guidance on auto tariffs.

Per Tesla’s website, as quoted on Reuters, it will begin selling cars in Saudi Arabia next month, indicating that CEO Musk and the kingdom have mended their past differences. Saudi Arabia, the largest market in the Gulf region, where EVs make up just 1% of total car sales, remained untouched by Tesla until now.

After finding significant success in the neighboring UAE, Tesla’s entry into the Saudi Arabia market is a piece of welcome news for the EV-maker.Government initiatives, including tax exemptions, subsidies and investments in charging infrastructure in the region, are expected to drive growth, making this a strategic entry point for Tesla.