Home Technology US rejects Tesla’s bid for tariff exemption for Model 3 ‘brain’

US rejects Tesla’s bid for tariff exemption for Model 3 ‘brain’

Containers are stacked on a vessel at the Port of Long Beach in Long Beach, California on July 6, 2018, including some from China Shipping, a conglomerate under the direct administration of China’s State Council.

Frederic J. Brown | AFP | Getty Images

U.S. trade officials rejected Tesla‘s bid for relief from President Donald Trump’s 25% tariffs on the Chinese-made computer “brain” of its Model 3 electric vehicle, one of more than 1,000 product denials linked to China’s industrial development plans.

According to documents filed by U.S. Trade Representative’s office (USTR) and reviewed by Reuters, Tesla’s and other tariff exclusion requests for Chinese-made products from aircraft parts to biotechnology instruments were all denied because they were deemed “strategically important” to the “Made in China 2025” program.

Tesla did not return requests for comment. Tesla has a separate pending tariff exclusion request for duties on the Chinese-made Model 3 Center Screen.

The company, in a securities filing on Monday, said that “our costs for producing our vehicles in the U.S. have also been affected by import duties on certain components sourced from China.”

The denials illustrate a systematic approach by the Trump administration to thwart China’s efforts to develop high-technology industries that it alleges had benefited from the theft and forced transfer of U.S. intellectual property.

Made in China 2025, a program aimed at growing China’s prowess in 10 strategic industries now dominated by the United States, is at the heart of trade negotiations and U.S. demands for sweeping changes to China’s trade, industrial and intellectual property policies.

Those industries include new energy and autonomous vehicles, aerospace, semiconductors, biopharmaceuticals, robotics and artificial intelligence.

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