Trump's tariffs shake markets, hit Tesla and Apple stocks
President Donald Trump's decision to impose tariffs on goods from China and Canada has significantly impacted the market. According to CNBC, Tesla and Apple recorded stock value drops of 5% and 3%, respectively.
Recall that Donald Trump signed an order on Saturday, implementing 25% tariffs on goods from Canada and Mexico, except for petroleum products subject to a lower 10% tariff. The President of the USA also decided to implement 10% tariffs on goods from China.
The new rates were initially set to take effect on Tuesday, February 4th. However, it is already known that this will not be the case for Mexico.
The announcement of tariffs on goods from China affected Apple and Tesla, led by Elon Musk. On Monday, Tesla lost 5%, and Apple lost over 3%.
Tesla under pressure from tariffs and declining sales
Tesla, which manufactures about half of its cars in China, is struggling with rising import costs and declining vehicle registrations in Europe. In January 2025, Tesla registrations in France fell by 63%, and in Sweden and Norway by 44% and 38%, respectively. This is a significantly greater decline than the overall electric vehicle market.
Another challenge for the company is weak demand for the Cybertruck. According to analyst "Troy Teslike," in 2024, Tesla ended the year with 10,600 unsold Cybertrucks, and the order list dropped to zero at the end of November.
Tesla's Chief Financial Officer, Vaibhav Taneja, acknowledged that the new tariffs could negatively affect the company's profitability despite its factories in the USA, Germany, and China. To boost sales, Tesla has already taken steps to reduce leasing costs for the Model 3 and Cybertruck.
The impact of Elon Musk's political decisions on the Tesla brand is also notable. According to Brand Finance, Musk actively supported Donald Trump's campaign and the far-right German party AfD, which led to a 26% drop in brand value in 2024.
Apple and the threat to the supply chain
Apple is also feeling the effects of Trump's decision. Although the company has diversified its supply chain, it still relies significantly on Chinese factories, where most of its products are assembled.
In the past, Apple avoided tariffs through exemptions and relocating production parts to India, Vietnam, or Malaysia. Now, analysts fear rising import costs will force the company to raise device prices in the US market.
According to Bank of America Securities, if Apple can source 80% of devices outside of China, the annual earnings per share could drop by only 5 cents. However, if half of the products still come from China, the loss could amount to 12 cents per share.
Apple has not publicly commented on the new tariffs. Still, analysts predict the company will increase production in India and other Southeast Asian countries to mitigate the impact of tariffs on its operations.
