Tesla’s rocking the U.S. car market as new tariffs shake up the competition. The electric car maker saw its U.S. auto sales jump 9.1% in March 2025, just before the government put new import taxes on foreign car parts and vehicles.
The company’s now holding 46% of America’s electric vehicle market in the second quarter of 2025. That’s even though total EV sales dropped to 310,839 units. Tesla‘s doing better than rivals because it makes its cars in the U.S. and doesn’t have to pay tariffs on imported vehicles like other brands do.
Tesla’s boss Elon Musk says the company imports about 30% of its parts, which now cost 25% more because of tariffs. But that’s still better than competitors who import whole cars. Some foreign carmakers from Germany, Japan, and Korea are adding $3,000 to $10,000 to their prices because of the new taxes.
Tesla imports 30% of parts facing 25% tariffs, while competitors importing whole cars add $3,000-$10,000 to prices.
While Tesla’s winning in America, it’s losing ground in Europe. Sales there dropped 49% in April 2025 compared to the year before. The company’s also dealing with protests and what some call “domestic terrorism” claims that hurt its image. In France and Germany, Tesla registrations fell by 63.4% and 59.5% respectively in January 2025.
GM’s electric car sales doubled in the second quarter of 2025, while Ford’s went down. General Motors’ strong performance comes from new models like the Equinox EV and Blazer EV driving their market share gains. Overall, electric vehicles make up 7.4% of U.S. car sales, down from 8% last year. First-quarter sales fell 14.5% from the end of 2024.
Tesla’s stock price dropped about 45% from its December 2024 high to March 2025. Investors worry about the company’s challenges even as it benefits from the tariffs.
The company’s preparing for a big sales push later this year. Federal tax credits for electric cars will end soon, so buyers might rush to get their cars before prices go up. Tesla owners benefit from charging costs that are three to five times lower than gasoline, making these vehicles attractive despite higher upfront prices.
Tesla’s focusing on its U.S. factories to avoid import costs while watching how customers react to recent controversies. The tariffs are changing America’s car market, and Tesla’s using its U.S.-made advantage to stay on top while foreign competitors struggle with higher costs.