Tesla’s reported plan to stop using Chinese-made components in US-built cars aligns with a “significant strategy” in national industrial policy, with some American giants seeking to “completely de-risk” supply chains amid an increasingly tense geopolitical climate, an automotive executive said.
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Curt Hopkins, CEO of automotive investment platform MCQ Markets in Miami, said Tesla appeared to be “developing a completely dual strategy, where in the US they’re going to de-China, diversify and make sure they continue to have access to government incentives”.
“And then in China, it [Tesla] is just fully localised, relying completely on Chinese battery and component system technology. They’re going to have two entirely different supply chain strategies for the cars.”
However, as electric vehicle (EV) technology in China rapidly advances and the US loses ground, he warned of a “big danger”: the possibility that the Chinese side could dominate the entire technology stack.
According to Tesla Mag, the EV giant plans to issue requirements forcing suppliers to exclude Chinese components from vehicles built in the US. A complete phase-out is anticipated within the next one or two years to mitigate the impact of tariffs and trade disputes.
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Tesla’s relatively mature manufacturing capacity and “established strategy” could “probably create this divide”, Hopkins said, noting that it would have to reshore everything and scale up battery capacity.