Tesla Stops Selling U.S.-Made Vehicles In China Because Of Tariffs

Good morning! It’s Friday, April 11, 2025, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. This is where you’ll find the most important stories that are shaping the way Americans drive and get around.

In this morning’s edition, we’re looking into which cars Tesla will no longer import into China from the U.S. as how Audi’s most popular model might be impossible to sell here because of Donald Trump’s tariffs. We’re also discussing BMW’s plans to boost output in the U.S. and Lucid’s deal to take over an EV plant from defunct truckmaker Nikola.

This week is ending with a bang, so buckle up, everybody. It’s going to be a wild ride.

Prospective Tesla buyers in China will have to solider on without the possibility of getting a new Model S or Model X. Both vehicles are imported from Tesla’s factory in the U.S., and the Chinese government has imposed some pretty steep tariffs on imports from America after President Trump started a trade war for no good reason.

There’s no official reason from Tesla as to why its two oldest models are no longer available in China (you can technically still get one if it has already been imported, but supplies are dwindling). However, it doesn’t take too much of a stable genius to figure out why. I mean, hell, the changes came just a day after China raised import tariffs on U.S. goods to match Trump’s tariffs. From the New York Times:

Since then, Mr. Trump raised tariffs an additional 41 percent to punish Beijing for its retaliatory move, bringing the total duty on imports from China to 145 percent. On Friday, China countered by also lifting its tariffs another 41 percent on American imports, starting on Saturday.

Tesla is still selling the Model S in a few Chinese cities where it has inventory. The Model S and Model X, two of the company’s more expensive offerings, are not big sellers in China.

Of course, CEO Elon Musk finds himself in a very sticky situation. The CEO has not publically criticized Trump’s tariff campaign, but he has apparently alluded to the fact he’d like them to go away. He’s also publically feuding with Peter Navarro, a White House senior advisor and one of the goobers who built up Trump’s trade policy.

Tesla operates an automobile factory and a battery plant in Shanghai. The Gigafactory, which opened in 2020, was Tesla’s first car factory outside of the United States. At the Shanghai facility, the company produces the Model 3 midsize sedan and Model Y sport utility vehicle for sale in China and export abroad.

Among foreign automakers, Tesla has one of the coziest relationships with the Chinese government. Tesla’s Shanghai Gigafactory was the first automobile factory in China to gain approval to be wholly owned by a foreign company without a domestic partner. Mr. Musk has gained unusual access to senior Chinese leaders, working closely with Li Qiang, China’s premier who used to be the top official in Shanghai.

Back in March, Tesla’s sales of Chinese-made vehicles fell 11.5 percent year-over-year, the Times reports. The automaker has struggled mightily to fend off the superior — and cheaper — alternatives provided by home-grown Chinese automakers like BYD. While Tesla’s sales fell last month, BYD’s rose 23 percent. I’m sure that chapped Elon’s ass. 

The Audi Q5 crossover might be in for a world of hurt because of President Trump’s tariff fiasco. The compact crossover is Audi’s top-selling vehicle in the U.S., but tariffs will hit its $45,400 MSRP three separate times, making it pretty much “unsellable,” according to people familiar with the situation at the German automaker.

The Q5 is going to be hit with a 25 percent duty on imported autos and the non-U.S.-made parts they contain. Then, it’ll be hit with a further 25 percent tariff on shipments from Mexico, and finally, it’ll get a 2.5 percent fee for not complying with the free-trade agreement Trump negotiated in his first term. It’s a disaster. From Bloomberg:

While automakers are still waiting for more guidance on the exact penalties they face, Audi is operating under the assumption that all three of those levies apply to the made-in-Mexico Q5, with duties totaling at least 52.5%, said the people, who weren’t authorized to speak publicly on the matter.

A spokesperson for Audi said it still intends to continue selling the Q5 in the US, and is exploring ways to mitigate the impact of the tariffs.

[…]

“The Q5 is a nice car, but if they’re making it there, they can’t sell it” in the US, said Ambrose Conroy, chief executive officer of Seraph, a consultancy that works with carmakers and their suppliers.

Earlier this week, Trump paused most reciprocal tariffs for 90 days, but he kept in place trade measures targeting the auto industry. I suppose he decided he hadn’t done enough damage yet.

The Q5 is a solid little crossover, but I can tell you with a lot of certainty that people will not want to spend upwards of $80,000 on one. Time will tell what Audi will do to remedy this tough situation.

BMW is considering adding shifts to its U.S. plant in Spartanburg, South Carolina to get around tariffs set by the Trump Administration. The plan is to boost output by as much as 80,000 units per year. Executives laid this all out on an analyst call on April 10 as the automaker tries to figure out ways to get around Trump’s trade war.

It’ll need to act fast, though. The German automaker has about 30 days’ worth of inventory in the U.S. as well as some stocks and components. That’ll give it until the end of May to keep prices stable here. After that, who the hell knows what could happen? From Reuters:

 The investor call was held before a closed period on company information ahead of annual results scheduled for May 7.

The carmaker’s Spartanburg plant, which exports around half of the vehicles it makes to customers outside the United States, is located in a free-trade zone.

That meant that parts imported by BMW for vehicles destined for exports were exempt from tariffs, executives said, providing some relief, according to the note.

Right now, the Spartanburg plant builds the X3, X4, X5, X6, X7 and XM crossovers. There’s no word on which additional model lines — whether it’s the smaller X1 and X2 or a handful of sedans — would be added to the plant’s production lines. According to BMW, the plant builds about 1,500 vehicles per day and 60 percent of those cars are exported from the U.S.

Lucid is taking over Nikola’s Phoenix, Arizona headquarters and Coolidge electric truck factory after the manufacturer filed for bankruptcy earlier this year. The Air sedan builder also says it plans to offer jobs to over 300 former Nikola employees. The agreement is subject to approval by the U.S. Bankruptcy Court for the District of Delaware.

Nikola’s defunct facilities would supplement Lucid’s existing factory in the nearby town of Casa Grande, Arizona. It’s a move that certainly makes a lot of sense — especially as Lucid begins to roll out its second model: the Gravity crossover. From Bloomberg:

“Acquiring these assets is an opportunity to strategically expand our manufacturing, warehousing, testing and development facilities while supporting our local Arizona community,” Marc Winterhoff, Lucid’s interim chief executive officer, said in a statement.

Winterhoff took over the top job in February from Peter Rawlinson, who’d been CEO since 2019 and led the EV maker through its merger with a blank-check company. Lucid’s market capitalization has plummeted 95% since peaking at $91.4 billion in November 2021, more than a year after Nikola went public by combining with a special purpose acquisition company, or SPAC.

Be on the lookout for my first drive review of the Gravity Grand Touring, set to come out next week. I cannot say too much about it yet, but I will say this: Lucid will almost certainly need the extra production capacity Nikola’s plant can provide.

On this date in 1970, NASA launched Apollo 13, its third lunar landing mission. Everything was going according to plan for astronauts Jim Lovell, John Swigert and Fred Haise until an oxygen tank exploded around 9 p.m. Eastern on April 13. Here’s what happened, from History.com:

At 9:00 p.m. EST on April 13, Apollo 13 was just over 200,000 miles from Earth. The crew had just completed a television broadcast and was inspecting Aquarius, the Landing Module (LM). The next day, Apollo 13 was to enter the moon’s orbit, and soon after, Lovell and Haise would become the fifth and sixth men to walk on the moon. At 9:08 p.m., these plans were shattered when an explosion rocked the spacecraft. Oxygen tank No. 2 had blown up, disabling the normal supply of oxygen, electricity, light, and water. Lovell reported to mission control: “Houston, we’ve had a problem here,” and the crew scrambled to find out what had happened. Several minutes later, Lovell looked out of the left-hand window and saw that the spacecraft was venting a gas, which turned out to be the Command Module’s (CM) oxygen. The landing mission was aborted.

[…]

For the next three days, Lovell, Haise and Swigert huddled in the freezing lunar module. Haise developed a case of the flu. Mission control spent this time frantically trying to develop a procedure that would allow the astronauts to restart the CM for reentry. On April 17, a last-minute navigational correction was made, this time using Earth as an alignment guide. Then the re-pressurized CM was successfully powered up after its long, cold sleep. The heavily damaged service module was shed, and one hour before re-entry the LM was disengaged from the CM. Just before 1 p.m., the spacecraft reentered Earth’s atmosphere. Mission control feared that the CM’s heat shields were damaged in the accident, but after four minutes of radio silence Apollo 13‘s parachutes were spotted, and the astronauts splashed down safely into the Pacific Ocean.

I don’t want to spoil anything more (if you somehow haven’t seen the movie), so head over to History.com for a full look at what happened and what the crew had to go through.