Tesla Inc (TSLA) Forced to Raise Prices in China as Tariffs Begin

Tesla Inc (NASDAQ:TSLA) is already a major exporter of electric vehicles to China, and the company has designs on exporting even more. However, the company now finds itself caught in the middle of the looming trade war between the US and China.

As Electrek reports, the automaker has decided to increase prices as a result.

Over the weekend, the prices of the Model S and Model X were increased by 150,000 yuan to 250,000 yuan (~$22,600 to ~$37,600) depending on the version.

Those are significant price increases as the original 25% tariff was supposed to be reduced to 15%, but it was instead increased to 40% in retaliation for the US’s latest list of tariffs for Chinese products.

Tariffs have been increased to a whopping 40 percent as the trade war escalates. Tesla sold more than $2 billion in vehicles in China last year, and that number was only expected to go up. Now that prices have been increased, those expectations may change.

The company reportedly has designs on building a factory in China in the future.

Tesla Inc shares rose $2.85 (+0.92%) in premarket trading Monday. Year-to-date, TSLA has declined -0.79%, versus a 4.09% rise in the benchmark S&P 500 index during the same period.

TSLA currently has a StockNews.com POWR Rating of B (Buy), and is ranked #4 of 24 stocks in the Auto & Vehicle Manufacturers category.