Business APAC
11th April 2025
The news that Tesla stops taking new orders for its high-end, American-made Model S sedan and Model X SUV through its Chinese website and WeChat channels this Friday signals the bite of US-China trade tensions.
Anyone visiting Tesla’s China site now won’t find the usual “Order Now” button for these two imported models; it’s simply gone or replaced with options to view existing stock, confirming that Tesla stops taking new orders for these models via the site. This halt doesn’t touch the Model 3 and Model Y cars, which Tesla builds locally at its Shanghai Giga factory and which make up the vast majority of its sales there.
While Tesla itself isn’t officially saying why, observers point directly to the hefty retaliatory tariffs China slapped on US goods – including cars – reportedly climbing as high as 84%. Those kinds of import taxes make the already pricey Model S and Model X significantly more expensive for Chinese buyers.
Beyond the Headlines: Low Sales, High Pressure for Tesla in China
Truth be told, these premium imports were always just a small fraction of Tesla’s business in China. Figures show fewer than 2,000 Model S and X vehicles landed there last year, a drop in the ocean compared to the more than 660,000 locally built Model 3s and Ys sold.
This decision unfolds as Tesla navigates an increasingly tricky market in China. The company’s sales numbers and overall market share have been slipping recently. Fierce competition from homegrown Chinese EV giants like BYD is heating up, and reports indicate Tesla’s own Shanghai factory output has dipped for several months straight, with first-quarter deliveries down significantly.
Interestingly, the fact that Tesla stops taking new orders isn’t limited to China; the company made a similar move in Japan just weeks ago, stopping custom orders for the S and X there from the end of March.Despite these pullbacks on new orders, there’s no official word from Tesla on why Tesla stops taking new orders in China, though company executives previously suggested the Model S and X weren’t being phased out globally and might even see updates later this year.
For now, the order halt underscores the complex challenges Tesla faces from both geopolitics and intense market rivalry in China.
Hiding Behind Tariffs? The Real Reason Tesla Halted S/X Orders in China
Sure, those massive new tariffs—a result of the US-China trade fight—look like the obvious reason Tesla stops taking new orders for the Model S and X in China. It’s a neat explanation. But does it tell the whole story? You could argue that the tariffs were just a convenient excuse for a decision Tesla probably needed to make, anyway. Let’s face it: demand in China for the older, super-expensive Model S and X has already dried up.
They were struggling against a flood of newer, high-tech, and much more aggressively priced luxury electric cars from Chinese powerhouses like BYD and Nio. So, maybe the situation where Tesla stops taking new orders wasn’t really about the tariffs making them impossible to sell but more about finally admitting that sales were already dead in the water?
It could easily be a strategic move—quietly ditching these low-selling, high-effort imports to pour all their resources into the real battle: defending the locally-made Model 3 and Y from getting swamped by the local competition. Maybe the tariff mess was just the final push needed before Tesla stops taking new orders.
Prithpaal Singh
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