Tesla Joins the ‘Purge’ of Chinese Parts in North America
US automaker Tesla has joined the trend of removing Chinese components from its US-made vehicles in order to reduce the impact of geopolitical tensions between Washington and Beijing on its supply chain.
According to a report in The Wall Street Journal, the company led by Elon Musk began gradually eliminating Chinese parts earlier this year, replacing them with components manufactured in Mexico, Southeast Asia, and Europe.
Executives and suppliers involved in the initiative said Tesla aims to eliminate Chinese parts within the next two years.
The report comes a few days after Reuters revealed a similar initiative at General Motors, whose executives are pressuring their suppliers to eliminate all components or materials from China by 2027.
The technology company declined to comment to the WSJ on the policy, but some sources say the change reflects both economic and strategic pressures.
The change accelerated after the Trump administration imposed heavy tariffs on a wide range of Chinese imports.
These measures complicated Tesla's procurement costs and forced the company to rethink the prices of vehicles manufactured at its plants in Fremont, California, and Austin, Texas.
Growing tariff uncertainty, supply chain risk, and restrictions on semiconductor exports have forced the automaker to insulate its U.S. operations from materials that rely on China.
