Tesla Halts Orders for Model S and Model X in China Due to Increasing Tariffs

Tesla has ceased new orders for its Model S and Model X electric vehicles in China, as reported by Reuters. While the company still markets other models such as the Model 3 and Model Y in the region, the two premium models have been taken off Tesla’s Chinese site.

Although Tesla has not provided an official rationale for this decision, both the Model S and Model X are produced in the United States. This coincides with intensifying trade tensions between the U.S. and China. On Friday, China declared a substantial rise in tariffs on U.S. imports, escalating them to 125 percent as a countermeasure to the 145 percent tariffs imposed by the U.S. under President Donald Trump. These tariffs are scheduled to be implemented on Saturday, April 12, as reported by Bloomberg.

The choice to discontinue the Model S and Model X in China may be a tactical reaction to these tariffs, which would considerably boost the cost of bringing U.S.-manufactured vehicles into the Chinese market.

Sales figures for these models in China have been quite limited. In 2024, China imported merely 1,553 Model X units and 311 Model S units, representing under 0.5 percent of Tesla’s over 657,000 deliveries that year, according to the China Auto Dealers Association. Conversely, the Model 3 and Model Y—both manufactured at Tesla’s Shanghai Gigafactory—remain in high demand and are sold domestically as well as exported to various markets, including Europe.

This situation adds to a mounting list of hurdles for Tesla. Worldwide, the company is experiencing a noteworthy downturn in sales. A March report indicated that Tesla sales in Germany plummeted by 76 percent, while sales in Australia declined by nearly 72 percent. Throughout the European Union, Tesla vehicle registrations fell by 45 percent in 2024, according to the European Automobile Manufacturers’ Association.

In addition to dwindling sales, Tesla is also witnessing a rise in trade-ins, as some customers part ways with the brand. Trade-ins have soared to unprecedented levels, and the company has reportedly begun to turn away customers looking to trade in their Cybertrucks due to unsold stock. Meanwhile, the resale value of pre-owned Teslas has significantly dropped, indicating diminishing consumer confidence.

In China, Tesla is grappling with tough competition from local manufacturer BYD, which has surpassed Tesla in sales of hybrid and electric vehicles.

As the global EV market evolves, Tesla must navigate not only competitive pressures but also the geopolitical repercussions of international trade conflicts.

For more updates on tariffs and their effects on the tech and automotive sectors, keep an eye on Mashable’s coverage, including the latest on Nintendo Switch 2 delays and iPhone 16 purchasing trends.