Image: Tesla
Tesla is reportedly pushing its suppliers to remove China-made components from vehicles built in the U.S., according to The Wall Street Journal. The publication said the company has already swapped out several China-sourced parts and aims to transition the rest over the next year or two, citing people familiar with the matter.
The move comes as automakers navigate ongoing U.S.-China trade tensions and shifting tariff policies. Executives across the industry have been forced into a scramble throughout 2025, with uncertainty around rare-earth materials, semiconductor availability, and rapidly changing tariff rules making long-term planning difficult.
According to The Wall Street Journal, Tesla and its suppliers have struggled with fluctuating tariffs impacting pricing strategies for U.S.-made EVs. The company has been increasing North American sourcing for its U.S. factories for the last two years amid tariff threats.
The push also arrives as Tesla’s China business faces renewed pressure. Data from the China Passenger Car Association showed Tesla’s China-made vehicle sales plummeted in October, reversing a gain the previous month. Production of the Model 3 and Model Y at Gigafactory Shanghai fell sharply from September, despite overall exports hitting a new two-year high.
Faced with these hurdles, Tesla continues to dominate the U.S. domestic manufacturing landscape. Earlier this year, the company’s entire S3XY lineup once again took the top four spots on Cars.com’s “American-Made Index,” led by the Model 3. Tesla has ranked first on the annual index several times, underscoring its efforts to localize supply chains and manufacturing wherever possible.
Like most automakers — and major tech firms such as Apple — Tesla has been working to reduce reliance on China for components used in U.S.-bound products. But fully eliminating China-made parts is no small task. China remains one of the world’s largest manufacturing hubs and a crucial source of cost-efficient components, meaning any transition will take time, careful sourcing, and substantial investment.
Tesla isn’t the only automaker rethinking its supply chain strategy. General Motors this week also told thousands of its suppliers to remove China-made components from their parts pipelines entirely, highlighting how widespread these shifts have become across the industry.
