Tesla Says No More Chinese Components in U.S. Cars
Tesla is asking suppliers to remove all Chinese components used in the manufacturing of its cars for the U.S. market.
According to a new report from the Wall Street Journal, the company had previously stopped using Chinese suppliers for automobiles destined for the U.S. market, and now it's asking suppliers to do the same.
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The report, citing sources familiar with the situation, said Tesla and its suppliers have already swapped some Chinese components for those made in other territories. In the next two years, the EV maker wants all parts made outside of China.
Since the pandemic, Tesla has tried to diversify its supply chain outside of the territory, even asking suppliers in China to start moving component production to Mexico and other areas. The tactic went into overdrive as President Donald Trump hit China with evolving tariffs that have made it difficult for Tesla and other automakers to rein in consistent pricing.
Many automotive components, from batteries to molded parts and materials, are made in China.
Tesla's business in China has taken some hits since trade tensions have escalated. According to the China Passenger Car Association, via Reuters, Tesla's China-made EV sales fell nearly 10% last month, compared to the previous year, and output of Tesla's Model 3 and Model Y at its factory in Shanghai has dropped more than 32%.
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