Pure chaos.
Now, those are two words that don’t sound appealing under any circumstances.
Yet that is the exact term that a team of Wedbush analysts led by Dan Ives used to describe President Donald Trump’s plan to slap a 25% tariff on all imported cars starting April 3.
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A similar duty on the auto-parts-supply chain will be imposed the following month, Trump said, giving companies operating within the USMCA trade pact time to verify U.S.-made components.
So, how is that going over with the folks in the car business? Not so good.
“Over the last 24 hours we have spoken to many in the auto industry from around the US, Europe, and Asia, and the conclusion is this tariff announcement (in its current form) would send the auto industry into pure chaos and raise the average price of cars between $5,000 on the low end and $10,000 to $15,000 on the high end,” Ives said in a March 28 research note.
“Every automaker in the world will have to raise prices in some form selling into the US, and the supply chain logistics of this tariff announcement heard around the world is hard to even put our arms around at this moment,” he added.
‘Winner from this tariff is no one’: Ives
The analyst said that even U.S. automakers that produce cars in America have roughly 40% to 50% of auto parts that come from abroad. A U.S. car with all U.S. parts made in the US is “a fictional tale not even possible today,” he added.
Meanwhile, Trump convened CEOs of some of the country’s top automakers for a call earlier this month and warned them not raise car prices because of tariffs, The Wall Street Journal reported.
“The winner in our view from this tariff is no one … as even Tesla still is hit from these tariffs and will be forced to raise prices,” said Ives, a big-time Tesla (TSLA)  bull.
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It may be surprising to hear Tesla getting tapped by tariffs, given Chief Executive Elon Musk’s connection with the Trump administration through his Department of Government Efficiency, which is dramatically reducing federal employment rolls.
Another Wall Street analyst, TD Cowen’s Itay Michaeli, says Tesla’s US-sold vehicles are made exclusively at the company’s Fremont, Calif., location or at Giga Austin in Texas, making the electric-vehicle maker a “relative winner” in the tariff wars.
Musk himself weighed in on the issue, stating on his X social-media platform, that it’s “important to note that Tesla is NOT unscathed here. The tariff impact on Tesla is still significant,” he said.
Tesla has been on the business end of some scathing protests. More than 200 demonstrations are slated to take place on March 29 during what organizers are calling a global day of action, part of a campaign called Tesla Takedown, NBC News reported.
At least 11 Tesla dealerships, charging stations and other facilities reportedly have been hit by attacks. A Las Vegas resident, Paul Hyon Kim, was arrested for allegedly setting Tesla vehicles on fire earlier this month and is now facing federal charges.
Tesla shares are down nearly 35% year-to-date and up more than 50% from a year ago.
Firm says few things at Tesla ‘happen in a straight line’
Investment firms have been reworking their price targets for the electric vehicle company.
RBC Capital affirmed an outperform rating and $320 price target on Tesla, but the investment firm expects its first-quarter deliveries to come in at 364,000, below the analyst consensus of 398,000.Â
Related: Veteran hedge fund manager sounds alarm on Tesla’s stock
The company’s January-February numbers were hurt by intentional shutdowns to refresh the Model Y midsize SUV. RBC Capital also expects some demand was delayed given that this new vehicle as well as the new affordable model are coming in Q2.
Deutsche Bank slashed its price target on Tesla to $345 from $420 and maintained a buy rating on the shares.
Ahead of the company’s Q1 delivery report, due early next week, the firm reset its auto-volume expectations for the quarter, all of 2025, and all of 2026. That’s based on weaker demand trends and a slower launch cadence for Model Q, Tesla’s much-anticipated compact and affordable electric SUV.
For Q1 Deutsche’s data tracking points to deliveries of 340,000-350,000, which likely means profit margins from autos will also be under greater pressure, the investment firm said.
For the full year, the firm now models Tesla’s deliveries declining 5% from 2024 to 1.7 million, assuming a staggered Model Q rollout starting in the U.S., then Europe and then China.
The shares have been under pressure, driven by much weaker auto volumes, a broader derating in growth assets, and political uncertainty, Deutsche Bank contended.
“Rarely anything at Tesla happens in a straight line and we would not expect robotaxi or humanoid [robots] to be linear,” the firm added, referring to some of the biggest items on Musk’s agenda.
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