President Donald Trump’s planned levies have sent shockwaves through the markets, with Apple and Tesla taking the biggest hit among America’s tech giants. Despite a brief pause in tariffs on North American allies, Tesla’s stock remained flat as investors considered the potential impact of trade tensions on its operations.
The electric vehicle manufacturer, which has tried to localize its supply chain in the US, Mexico, and China, would be severely affected by Trump’s proposed 25% tariff on Canada and Mexico. The industry’s complex supply chains mean that parts can cross borders multiple times before reaching a finished vehicle, making it vulnerable to disruptions.
Tesla CFO Vaibhav Taneja noted last week that the company is still reliant on global parts for its operations, which would make tariffs a significant concern. CEO Elon Musk has spoken out against tariffs in the past, calling them “not good” and saying they can distort markets.
Apple’s stock also took a hit, dropping 3% on Monday. However, Bank of America analysts believe that Trump’s 10% tariff on Chinese goods should have a minimal impact on the company’s bottom line. They estimate that 80% of Apple products sold in the US can be sourced from outside China, with many models now manufactured in India.
The pause in tariffs on North American allies has given investors some relief, but it remains to be seen how Tesla and other companies will adapt to ongoing trade tensions. As the situation continues to unfold, one thing is clear: even the world’s largest and richest companies are not immune to tariff shocks.
Source: https://fortune.com/2025/02/04/trump-tariffs-worry-tesla-apple