Winners of Trump's auto tariffs: Elon Musk

Under the shadow of tariffs, Elon Musk stands out among a group of victims and may become the biggest beneficiary under the tariff stick.

According to CCTV News, on March 26 local time, U.S. President Trump signed an executive order at the White House, announcing a 25% tariff on all imported cars. The related measures will take effect on April 2.

Since Tesla, led by Musk, produces all cars sold in the U.S. domestically, it will almost completely avoid the impending impact of the import car tariffs. In contrast, major global competitors, including Hyundai, Volkswagen, and General Motors, will face a sharp rise in costs.

Sam Fiorani, Vice President of Global Automotive Forecasting at AutoForecast Solutions, stated:

"There are few winners, consumers will be the losers, facing fewer choices and higher prices."

A Safe Haven in the Tariff Tsunami: Tesla's Unique Advantage

As Tesla boasts on its X platform, its models are "the most American-made cars." CFRA Research analyst Garrett Nelson pointed out in an analysis this week that due to its domestic manufacturing operations, Tesla is the "least affected" automaker.

According to documents from the U.S. National Highway Traffic Safety Administration for 2024, 60% to 75% of the parts used by Tesla are made in the U.S., with the specific ratio depending on the model, while the majority of the remaining parts come from Mexico.

Ford may also be less affected than some competitors, as about 80% of the cars it sells in the U.S. are produced domestically. However, Ford still cannot escape the impact, as the company produces entry-level Maverick small pickups, Bronco Sport compact SUVs, and Mustang Mach-E electric vehicles in Mexico.

Foreign brands that heavily rely on imported vehicles will face the greatest pressure, with South Korea's Hyundai likely being one of the hardest-hit companies. Although Hyundai and its affiliate Kia have factories in Alabama and Georgia—and announced a $21 billion expansion plan in the U.S. this week—data from Global Data shows that last year, it imported over 1 million cars to the U.S., accounting for more than half of its sales in the country.

According to analysis by Hyuk Jin Yoon, an analyst at SK Securities in Seoul, if the tariffs are implemented, Hyundai and Kia may need to pay up to 1 trillion Korean won (approximately $7 billion) in tariffs annually, accounting for nearly 40% of the total operating profit of the two automakers in 2024. **

Global Automotive Giants Are Not Immune

Even Toyota—the world's largest automaker, with four assembly plants in Kentucky, Indiana, Mississippi, and Texas, as well as engine plants in West Virginia and Alabama—still imports about half of the vehicles it sells in the United States.

According to estimates from Goldman Sachs' Japanese analysts, tariffs could reduce Toyota's estimated operating profit for the fiscal year 2026 by 6%. Nissan may be the most affected among Japanese automakers, with its operating profit expected to decline by 56%.

Although Tesla CEO Elon Musk acknowledged that tariffs would have a "significant" impact on the company, Trump insisted that this does not constitute a conflict of interest, considering Musk's important role in the government. Musk stated on the X platform that the prices of imported auto parts used by Tesla would be "not insignificant" affected.

Sam Fiorani, Vice President of Global Vehicle Forecasts at AutoForecast Solutions, said in a phone interview:

"There are few winners, and consumers will be the losers, facing fewer choices and higher prices."