Donald Trump is back in the White House, and his second wave of tariffs in 2025 is causing chaos for global businesses. But few are feeling the heat quite like Elon Musk.
For years, Musk built his empire—Tesla, SpaceX, Starlink, and more—on global supply chains, foreign markets, and international partnerships. Now, with Trump imposing heavy tariffs on China, Europe, and other nations, Musk’s businesses are getting hit from all sides.
Can Musk navigate the trade war? Or will Trump’s tariffs force his companies into crisis?
Let’s break down exactly how these tariffs are disrupting Musk’s empire—business by business.
🚗 Tesla: The Biggest Target of Trump’s Tariffs?
Of all Musk’s businesses, Tesla is taking the hardest hit.
🔹 Supply Chain Costs Are Soaring
- Tesla relies on China for key materials—especially high-purity graphite for its EV batteries.
- Trump’s new tariffs raise the cost of importing these materials.
- Result? Tesla must either eat the cost (hurting profits) or pass it to customers (hurting sales).
🔹 China & Europe Are Fighting Back
- China and the EU are slapping retaliatory tariffs on U.S. goods—including electric vehicles.
- Tesla’s China sales dropped 49% year-over-year in early 2025.
- Germany’s Tesla sales fell 76%.
- Tesla is warning investors that tariffs could “significantly impact” its bottom line.
🔹 Musk's Dilemma: Is It Time to Move Production?
- If tariffs remain in place, Tesla might have to move more production outside the U.S.
- Will Musk expand Tesla’s factory in Mexico to avoid tariffs? Or will he double down on lobbying Trump?
Tesla’s future now hinges on whether Musk can cut a deal—or take the hit.
🚀 SpaceX: Rising Costs & International Barriers
Musk’s aerospace giant isn’t immune from the tariff war either.
🔹 Rocket Materials Are Getting More Expensive
- SpaceX depends on imports of steel, aluminum, and high-tech components from China, Mexico, and Canada.
- Trump’s tariffs are driving up prices, making each rocket launch more expensive.
🔹 Starlink is Running into Trade Barriers
- SpaceX’s Starlink wants to expand worldwide, but trade conflicts are making it harder.
- Some foreign governments are increasing regulatory fees on Starlink, pushing up costs.
- Musk has directly asked the U.S. government to help fight foreign restrictions.
🔹 Could NASA & The Military Pay the Price?
- SpaceX relies on government contracts for NASA and the U.S. military.
- If tariffs increase launch costs, will NASA foot the bill or look elsewhere for cheaper options?
SpaceX isn’t in crisis—yet. But if costs keep rising, government partnerships and Starlink’s expansion could suffer.
🛠️ The Rest of Musk’s Empire: Safe… for Now?
🔹 X (formerly Twitter) and Neuralink
- As digital-first companies, they’re largely unaffected by tariffs.
- However, if global economies slow down, advertising revenue on X could take a hit.
🔹 The Boring Company
- Focuses on U.S. infrastructure, so not heavily exposed to global trade.
- However, if material costs rise, tunnel projects could become more expensive.
While these ventures aren’t in the crosshairs yet, any economic slowdown could eventually ripple into Musk’s other businesses.
📉 Will Musk’s Close Ties to Trump Help or Hurt?
Here’s where it gets interesting.
Elon Musk has influence inside Trump’s administration. He was appointed head of the Department of Government Efficiency.
🚀 Does this mean he can negotiate exemptions for Tesla and SpaceX?
🔥 Or will his public criticisms of Trump in the past hurt his chances?
At the same time, Musk has warned against too much government interference and prides himself on being an independent thinker.
Now, he’s in a tough spot: Does he fight against Trump’s tariffs—or try to use his influence to get special treatment?
🔮 The Big Picture: Can Musk Survive the Trade War?
🔹 Tesla is facing major challenges—from supply chain costs to plummeting international sales.
🔹 SpaceX is seeing rising costs for materials and regulatory headaches abroad.
🔹 Other ventures are stable, but tariffs could create ripple effects down the road.
So, how will Musk respond?
🚀 Option 1: Lobby Trump for Tariff Exemptions – If successful, this could protect Tesla and SpaceX from the worst effects.
🌎 Option 2: Shift More Production Overseas – Tesla could move more factories abroad to bypass tariffs, but this would be politically risky.
📉 Option 3: Pass Costs to Customers – Raising Tesla prices could hurt demand even further.
🤔 What Do You Think?
Will Musk find a way to beat the tariffs, or will they drag down Tesla and SpaceX?
Drop your thoughts below! 🚀🔥
