Tesla breaks with China. The manufacturer requires suppliers to exclude components

Tesla requires suppliers to exclude components from China from the production of its cars in the US, the Wall Street Journal reported.

Tesla and its suppliers have already replaced some components made in China with parts made in other countries. The company plans to replace all remaining components with those manufactured outside China within the next year or two, WSJ wrote on Friday, citing people close to the matter.

The daily considered the decision “a new example of the consequences of deepening geopolitical tensions between the US and China.”

Tesla has been trying to reduce its reliance on Chinese-made components for its U.S. cars since the Covid-19 pandemic disrupted the flow of goods from China, encouraging its suppliers to produce components elsewhere, including Mexico. This year, however, after U.S. President Donald Trump imposed tariffs on Chinese imports, the company accelerated its strategy to eliminate Chinese parts.

China is a major producer and exporter of car parts – including chips and batteries – and materials for car production. Many of them are cheaper due to the huge scale of production, lower costs and weak currency – explained the American daily. (PAP)

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