Tesla China suspends orders for US-made Model S and Model X amid escalating tariff war

Tesla CEO Elon Musk warned that despite being close to the president, his company would not be spared the consequences of the new tariffs imposed by the current US administration. His words may prove true already, as the company's China operation has stopped taking orders for the Model S and Model X.

Chinese Tesla customers have to import the brand's two most expensive electric cars because they are made in the US, making them vulnerable to the escalating trade wars between the two nations.

Shipping the Model S and Model X from overseas could take up to eight months for Chinese buyers. However, even those prepared to wait can no longer order the luxury EVs as Tesla replaces the "Order Now" buttons on the models' web pages with "View Now." The Model 3 and Model Y remain available for purchase, but Tesla manufactures them in Shanghai.

China's retaliatory tariffs now mean goods from the US are subject to 84 percent import duties. Tacking these additional costs on the high prices of the Model S and Model X could make them impractical for many Chinese buyers. However, the two models represented less than 4 percent of Tesla's sales last quarter, meaning the automaker could expect minimal impact from blocking Chinese orders in the short term.