[UNITED STATES] Kimbal Musk followed his brother, Elon Musk, in criticizing tariffs, describing US President Donald Trump's recent moves as a "structural, permanent tax on the American consumer".
The debate over tariffs has intensified in recent weeks as the Biden administration weighs whether to maintain or adjust Trump-era trade policies. Economists remain divided on the long-term impact, with some arguing that protectionist measures shield domestic industries, while others warn they stifle competition and innovation. Kimbal Musk’s remarks reflect a growing concern among business leaders about the broader economic consequences of sustained trade barriers.
"Even if he is successful in bringing jobs onshore through the tariff tax, prices will remain high, and the consumption tax will remain in the form of higher prices because we are simply not as good at making everything," said Kimbal Musk, a Tesla Inc. board member, in a post on X. He noted that the approach could result in a cycle of reduced demand and job losses.
Tesla, which relies on a global supply chain for components like batteries and semiconductors, has been particularly vocal about the risks of trade restrictions. The company’s Gigafactories in the US and abroad depend on imported materials, and analysts suggest that higher tariffs could disrupt production timelines and inflate costs for electric vehicles—potentially slowing consumer adoption.
Elon Musk's statements on tariffs were heavily featured in a "Saturday Night Live" spoof, as well as in comments by Senator Ted Cruz, who said there are "angels and demons" battling for influence as the White House prepares to apply the toughest US trade taxes in more than 100 years.
The political divide over tariffs underscores a broader ideological clash within the Republican Party. While some conservatives, like Cruz, align with Trump’s America-first approach, libertarian-leaning figures, including the Musk brothers, advocate for free-market principles. This tension could shape the party’s economic platform ahead of the 2024 election, with trade policy emerging as a key battleground.
“Elon is one of the angels,” Cruz said on his podcast released on Monday. “This is a good, good voice that is focused on US jobs that I hope the president is listening to.” Tesla's stock surged following Trump's election, but has plunged more than 50% since reaching a record high in mid-December.
The volatility in Tesla’s shares highlights the broader uncertainty facing the auto industry as it navigates shifting trade policies and supply chain disruptions. Competitors like Ford and GM have also faced pressure from rising material costs, though some have adapted by localizing production. Tesla’s ability to maintain its market lead may hinge on how effectively it can mitigate these external pressures.
Just a month ago, Kimbal Musk had thanked Trump for supporting Tesla after the electric vehicles were featured at a press conference on the White House lawn. Outside his work with Tesla, Musk also owns a restaurant chain.
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