Tesla has suspended new orders for its premium Model S and Model X vehicles in China, in a dramatic response to mounting tensions between the United States and China following a sharp escalation in tariffs by the Trump administration.
The halt, which took effect hours after President Donald Trump imposed sweeping 145% tariffs on Chinese goods, marks a significant shift for Elon Musk’s company. Tesla quietly removed the two models from its Chinese website and its WeChat mini program, according to reports from Reuters. The move signals early fallout from a trade conflict that is beginning to ripple through global industries.
Though the Model S and Model X represented less than 5% of Tesla’s total sales last year—overshadowed by the more affordable and locally produced Model 3 and Model Y—their suspension is seen as a symbolic retreat in a crucial market. China has been a vital component of Tesla’s global strategy, both as a sales leader and a production hub for electric vehicle batteries and components.
In 2024, Tesla’s sales in China hit a record 657,000 vehicles, up 8.8% from the previous year. Yet despite the growth, the company has been rapidly losing ground to domestic rivals. Shenzhen-based BYD overtook Tesla in global EV revenues last year, underscoring the increasing competitiveness of China’s homegrown electric vehicle industry.
The decision to freeze orders comes amid a broader geopolitical storm and internal political drama in the U.S. Tesla CEO Elon Musk has not held back in criticizing the White House. Earlier this week, he launched a scathing attack on Trump’s trade adviser Peter Navarro, calling him “dumber than a sack of bricks” and “truly a moron” on his social media platform X, after Navarro dismissed Tesla as merely a “car assembler.”
Musk has reportedly been lobbying behind the scenes for a reversal of the tariffs, warning of “significant” impacts on Tesla’s global operations. According to the Washington Post, the billionaire entrepreneur personally urged President Trump over the weekend to ease tensions and reverse course, as financial markets reeled from the trade war escalation.
Tesla’s stock has taken a hit, dropping nearly 50% from its all-time highs in December. The brand has also been battling growing public backlash in the U.S., where some former fans have begun boycotting the company over Musk’s increasingly controversial political associations. Some Tesla drivers have gone as far as placing disclaimers on their vehicles: “I bought this before we knew Elon was crazy.”
The turbulence has coincided with Tesla’s sharpest drop in quarterly sales in over a decade, raising concerns about the company’s resilience amid political and economic crosswinds.
Adding to Tesla’s woes, the FBI earlier this month opened an investigation into a string of arson attacks targeting Tesla vehicles and dealerships. Multiple Molotov cocktail incidents have been reported, sparking fears of politically motivated violence against the EV maker.
