Elon Musk’s Tesla got a major boost after his close ally and US President Donald Trump imposed new 25% auto tariffs.
According to New York Post, the Department of Government Efficiency (DOGE) head Musk owns a leading electric vehicle company, Tesla, that builds all its electric cars in the US and sells them in the factories located in California and Texas.
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This means that Tesla will most likely avoid the worst effect of the new auto tariffs, while its competitors, including GM, Ford, Hyundai, and Volkswagen, which imports cars from other countries, will suffer the adverse effect of the duty.
The first impact of the tariffs was seen during Thursday, March 27, 2025, trading when Tesla shares surged by nearly 4% while the Big Three, GM, Ford and Stellantis, which owns the Jeep and Chrysler brands, fell by 8%, 4% and 3%, respectively.
Financial analysts at research firm Bernstein in a note on Thursday said, “Tesla wins, Detroit bleeds... Tesla is the clear structural winner: localised, strong market share, better insulated from trade risk. For everyone else, this is a margin reset and a real drag on near-term earnings power.”
Bernstein estimated that new tariffs will result in “up to $110 billion in annual tariff costs” for automakers. In order to deal with this, the manufacturers have two options: either to bear extra costs themselves or raise vehicle prices for customers.
The research forms also predicted that in the coming days the car prices will go up by an average of $3,700.
Related: Tesla UK sales rise despite backlash over Musk's political views
