Tesla files lawsuit against Trump administration over tariffs

Marco Green
September 25, 2020

Tesla CEO Elon Musk attends an opening ceremony for Tesla China-made Model Y program in Shanghai, east China, Jan. 7, 2020. It wants refunds of the money it has paid, plus interest.

Electric-car maker Tesla is suing the Trump administration and Robert Lighthizer, the USA trade representative, over government-imposed tariffs on parts Tesla imports from China.

At the time, the company argued that the increased cost imposed by the tariffs would cause economic harm through the increase of costs and impact to profitability.

Photo taken on January 7, 2020 shows an inside view of Tesla Shanghai gigafactory in east China's Shanghai.

The lawsuit, filed on Monday in the New York-based Court of International Trade, says the 25 per cent tariffs imposed by the US Trade Representative on a list of products including spare parts like terminals Tesla uses in its cars are "arbitrary, capricious, and an abuse of discretion". Last year, Lighthizer's office turned down a request from Tesla to exempt display screens it uses in its Model 3 electric cars from the 25 percent duty the USA has imposed.

Tesla shares on Wednesday tumbled 10 percent to 380.36 USA dollars after its annual "Battery Day" event, in which its CEO Elon Musk said the company will cut costs to build a cheap electric auto with a price tag of 25,000 US dollars in three years.

China and the USA signed their "phase one" trade deal earlier this year that partially ended the dispute, under which China promised to buy $200 billion in United States goods and Washington backed down on tariffs on $160 billion in Chinese goods, particularly consumer electronics.

Other reports by Click Lancashire

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