Elon Musk, head of the U.S. government efficiency department (DOGE) under the Donald Trump administration, leads the electric vehicle company Tesla, whose stock closed at $383.68 on the 3rd (local time), down 5.17% due to concerns over a tariff war.
Tesla's stock, which closed at $404.60 on January 31, the previous trading day, opened at $386.68, down 4.43%, when the market opened that day.
The sharp decline in Tesla's stock price that day was influenced by President Trump’s announcement over the weekend that a 25% tariff would be imposed on products imported from Canada and Mexico, raising fears of a tariff war. Although President Trump announced a one-month delay in imposing tariffs on Mexico that day, uncertainty remains.
All Teslas sold in the U.S. market are assembled in the U.S., but the parts are not. According to the U.S. financial media Barron's, about 15% of the parts for the Model Y sold in the U.S. are imported from Mexico, and some of the remaining parts are also imported from Canada.
Christia Freeland, former Canadian Minister of Finance who resigned last month, recently stated on Instagram, "If Donald Trump imposes a 25% tariff on Canadian goods, we must retaliate with a 100% tariff on all Tesla vehicles, as well as American wine and beer."
In media interviews, she also said that Canada should respond to tariffs targeting Tesla and others. The argument is that a counterattack effect should be made by targeting Musk, the CEO and a close ally of President Trump.
Also, on the morning of the same day, the Governor of Ontario, Canada, announced the cancellation of the contract for the use of the Starlink satellite internet service with Musk’s space company SpaceX. He stated, "Ontario will not do business with those who seek to destroy our economy."
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