Tesla Inc. so far has managed to deftly navigate the supply chain crisis and U.S.-China trade tensions that have hamstrung manufacturers globally. The EV maker’s latest worries show it’s about to get tougher for companies that hoped the worst was behind them.
Joining a host of other auto suppliers looking for tariff exclusions on various parts, Elon Musk’s company submitted three comments to the U.S. Trade Representative supporting waivers on essential raw materials it needs to import from China. In them, Tesla says "natural graphite is currently not available in the specifications nor capacity outside of its current suppliers and China that is required” for it to manufacture EV batteries in the U.S. Tesla is requesting waivers on various forms of artificial and natural graphite.
That's a stark reversal of fortunes. Over the past few years — even through the trade war — Tesla emerged as a winner in China. It entered on favorable terms and set up its own venture, unlike other automakers that have had to operate in partnerships with ownership caps. The company also leveraged Beijing’s EV-friendly policies to ramp up production and build out a deep supply chain in China. All of this meant that Tesla has been able to boost manufacturing substantially, even as rivals’ plans were up in the air.