TLDR:
- Tesla has stopped taking orders for Model S and X in China following 125% Chinese tariffs on US-made cars
- The Model S and X represent less than 0.5% of Tesla’s global deliveries
- Tesla stock formed a “death cross” with the 50-day moving average falling below the 200-day average
- Tesla shares are down 41% since President Trump’s inauguration on January 20
- Upcoming catalysts include Q1 earnings, a new low-price model, and robotaxi service launch
Tesla has quietly halted new orders for its Model S and Model X vehicles in China. This move comes as trade tensions between the United States and China intensify.
Chinese users attempting to order these models on Tesla’s website or WeChat mini program found them unavailable as of Friday. The company has not provided an explanation for the decision.
The timing coincides with China’s implementation of a 125% tariff on US-made vehicles. This tariff increase was in direct response to President Donald Trump’s decision to raise duties on Chinese goods to 145%.
Trade War Impacts
Both the Model S and Model X are manufactured in the United States and shipped to China. However, these models represent only a small portion of Tesla’s business in the country.
In 2024, Tesla imported just 1,553 Model X and 311 Model S units to China. These figures account for less than 0.5% of the company’s global deliveries of over 657,000 vehicles last year.
The majority of Tesla’s success in China comes from its Shanghai-produced Model 3 and Model Y. These locally-made vehicles dominate Tesla’s sales in China and are also exported to European markets.
Tesla’s Shanghai production facility has helped the company avoid some of the trade war impacts that have affected other automakers. By manufacturing vehicles locally, Tesla can bypass certain tariffs.
Despite this advantage, Tesla faces growing pressure in China. Domestic competitors like BYD continue to gain market share in the world’s largest electric vehicle market.
Technical Troubles
In a separate development, Tesla’s stock formed what traders call a “death cross” on Monday. This technical pattern occurs when a shorter-term moving average crosses below a longer-term moving average.
Specifically, Tesla’s 50-day moving average (approximately $289 per share) has fallen below its 200-day moving average (about $291 per share). For many traders, this pattern signals weakening momentum.
Tesla shares were up 0.3% in premarket trading Tuesday, reaching $254.10. This slight gain came despite the generally negative sentiment surrounding the death cross formation.
The company’s stock has behaved unpredictably in the past. After the previous death cross in February 2024, shares were flat a month later and up 15% six months after the event.
Tesla stock has declined 41% since President Trump’s inauguration on January 20. This drop reflects investor concerns about several factors affecting the company.
Looking Ahead
Tesla faces multiple challenges but also has potential catalysts on the horizon. The company will soon report its first-quarter earnings, which could influence investor sentiment.
The automaker also plans to launch a new lower-priced model. This vehicle could help Tesla compete more effectively in price-sensitive markets.
Additionally, Tesla is preparing to launch its robotaxi service. This initiative represents a new potential revenue stream for the company.
Investor anxiety currently centers on Tesla’s sales figures, CEO Elon Musk’s activities, and the effects of global auto industry tariffs. These concerns appear to be outweighing potential positive developments in the near term.
Tesla’s premium vehicle lineup, including the Model S, Model X, and Cybertruck, saw a 25% drop in global deliveries during the first quarter. Analysts attribute this decline to lack of updates and growing backlash over Elon Musk’s political presence.
The combination of rising tariffs and intensifying competition creates serious challenges for Tesla’s strategy in China. The timing of these headwinds is particularly problematic for the electric vehicle maker.
Tesla has not responded to requests for comment regarding its decision to stop taking Model S and X orders in China. The company has made no public statements about how it plans to address the new tariff situation.
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