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Tesla wins partial tariff waiver

Jun. 24, 2019 3:31 PM ETTSLABy: Clark Schultz, SA News Editor163 Comments
  • Tesla (TSLA +1.2%) landed a one-year tariff waiver from the Commerce Department for imported aluminum from Japan, according to Reuters.
  • The EV automaker sought the waiver for 10M kilograms of aluminum imported annually from Nippon Light Metal. The Commerce Department determined that the metal was not produced in the U.S. in a sufficient and reasonably available amount or at a satisfactory quality level.
  • The aluminum is used for battery cell production at Tesla's Gigafactory.

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Comments (150)

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Ironically but unsurprisingly, Elon Musk and Tesla are huge polluters.

How much do Toyota plants pollute? It's all relative my friend.
I guess you've got to break a few eggs to make a sustainable omelet. Of course, those chickens will never be born.
-Philosophy has never been my strong suit.
Important article for Tesla bulls:

What in the world is kcrw? never heard of it
The article was very in-cohesive. Sounded more like an essay than news
The truth can be messy.
Some lies are very cohesive; but not Musk's! LOL
HunterKiller89 profile picture
KCRW is NPR's west coast radiostation out of Santa Monica/Los Angeles.

A lot of the article is just the live transcript, with leading bits for context. Makes sense.
CentralScrutinizer profile picture
10% reduction in Aluminium costs is significant.
Yes. This will lower Tesla's costs by $1-2 million a year. That should make a huge dent in the multi-billion dollar loss they're running.
djunh1 profile picture
I love it, they think the reduction of costs to the tune of 2 million dollars a year is 'significant' , but seem to ignore that the company loses two orders of magnitude more on the bottom line per quarter than this.

talk about selectivity.
How is it even a "reduction"?
The costs remain what they were; they just don't get hit with additional tariffs.
Famous Tech investment banker Frank Quattrone is out trashing Tesla. This feels like a defection from the omerta of the criminal techies heretofore reluctant to criticize Elon. This is a watershed moment. Beware. Elon is rapidly losing friends and famous people.

Quattrone says that Tesla Service Hell is causing HUGE BRAND DESTRUCTION.

"Tesla’s new automated approach to scheduling service appointments risks huge brand destruction. Can no longer call your local service location to schedule or modify appointment—need to use app—if app doesn’t work need to use http://Tesla.com chat—takes forever to connect"

'Whether intentional or not Tesla is sending message to customers that it either doesn’t care about customer experience or doesn’t have enough people to implement new chat approach. Before this change I was delighted with my overall experience with the brand; now very frustrated."
"TESLA Model 3 has arrived in the UK. Express.co.uk has been given a preview and short test drive of the vehicle. Here’s what we think about the new electric car."

Tesla Model 3 driving impressions - What its like to drive and why you should buy one
djunh1 profile picture
jack treme, andreas nebula, bluebeard research and now quark star? You've changed your names 3 times this year alone.

Glad to see tesla has some extra money left over from their raise or whatever to pay people like you. Once you disappear, we can make an educated guess that the company is running into financial problems again.
smurf profile picture

You forgot to mention @runiter ...one of the pro-trolls.
What's happening shorties? We going up or down this week?
Davewmart profile picture
@Quark Star

Either way, Tesla will deem it appropriate to have employees pumping their stock.

So keep pumping, so long as the cheques clear.
But I thought it was the Russian trolls working for the Wall Street hedgies that was running the smear campaign here. I'm just a guest, right?

You see the hedgies learned something valuable from DC politics: If Trump can collude with Russia, then why can't they? After all, why should Trump have all the fun?
Davewmart profile picture
@Quark Star

I notice that there is no denial by you that you are paid to pump.

IOW, a shill, and your comments have commensurate value, or lack thereof.
Well that was a close call, now Tesla is safe and has been totally financially redeemed.
leeo268 profile picture
It is super ridiculous the US government can jack tariff to make international trade unprofitable for a domestic company. Now, the US government dictate which company can trade internationally by changing the tariff on an individual basis. With the big government controlling trade completely, it is becoming more and more like Soviet control economy.
that was one of Vladimir's goals, and he has succeeded.
half the population are OK with Russia and want the USA to be more like Russia
Aussie Machead profile picture
Good that the government isn't taking a bite out of a US manufacturer
Presbyopic profile picture

We drove an $87,000 Jaguar I-PACE to see how it compares with a $57,500 Tesla Model 3 and a $150,000 Model X. Here's the verdict.

Buggah profile picture
So Matthew DeBord writes the I-PACE drives better, is more luxurious. The X has more space but because the Model 3 has many great 'ideas' crammed into the automobile, I choose the model 3.
Renegade Investment Research profile picture
Thanks @DownGoesOil for the article link

The verdict below:

"Verdict? For me, the best of the three is ... the Model 3! But it can't be all things to all people. I have to give it to the Jaguar I-PACE, which is my runner-up - and a better vehicle in many respects: more luxurious, more suave, lots of fun to drive.

The Model X is kind of sui generis. On paper, it's the winner. But on paper, it also costs much more.

As for the Model 3, "there is no better vehicle of this type at this price that I believe I could currently buy," I said in my review.

"What's really so hypnotically and addictively compelling about the Model 3 is how many great ideas have been crammed into one automobile," I said. "This is a car that's absolutely bursting with thought, about the present and the future - and the distant future. Those ideas are overwhelmingly optimistic."

The Jag has ideas, but there aren't as many as in the Model 3 (even though the Jag, in the end, drives better). And while the Model X has plenty of ideas, they aren't as good as the Model 3's.

If you need space for a family, the Model X is a better choice - though clearly you have to be prepared to take out a second mortgage.

The I-PACE is far more traditionally luxurious than then Model 3, and it's a proper crossover. If a premium vibe matters to you, the Jag is absolutely worth it.

But for me, the best of these all-electric trendsetters is the Model 3."
User 509088 profile picture
Kinder gentler mad King George this week. Didn't kill the Persians. Didn't kick out his raw meat. Hasn't tortured his fed chair much.
This, too
flufferty the gigabot profile picture
"Using the evidence of thousands of George III's own handwritten letters, Dr Peter Garrard and Dr Vassiliki Rentoumi have been analysing his use of language. They have discovered that during his episodes of illness, his sentences were much longer than when he was well.

A sentence containing 400 words and eight verbs was not unusual. George III, when ill, often repeated himself, and at the same time his vocabulary became much more complex, creative and colourful."

Librab103 profile picture
shhh. do not tell Trump because he will be pissed. also can remind Tesla fanboys how Teslas are shown to be less and less American with each passing day.
Nobody cares how American it is, and honestly, I don’t know anyone whose motivation to buy. Tesla was because it’s an American car. Nice try tho buddy.

"also can remind Tesla fanboys how Teslas are shown to be less and less American with each passing day."

Strange logic, my friend. If Tesla gets a waiver for this aluminum import doesn't that imply it was already the source of the aluminum used in the Model 3 battery cells?

Therefore the proportion of imported aluminum in a Model 3 is the same as last month...before the waiver was sought.

I think it is exciting to see an American car manufacturer selling ten thousand and more vehicles made in the United States (with a proportion of imported parts)this month into Europe
madhaus profile picture
Probably the biggest percentage of American content of any vehicle manufacturer, but do go on with your ridiculous FUD.
Well! This news will create the biggest short squeeze in history!

eventhorizonyou profile picture
Just Google "California oil imports." $tsla is posting huge sales numbers oit there for a reason. "The ultimate digital Platform" and everyone knows that as well.

Who ran Microsoft when Bill Gates stepped down? "A Detroit guy" of course. These are all Goldman Sachs orchestrated bear raids and the numbers prove this out. Those short have been totally snookered.
Great article. www.kcrw.com/...
Relatively little aluminum is used in the batteries. They do have aluminum foil in them. The major use of aluminum is in manufacturing the Model S and X bodies. There is also large aluminum parts in the Model 3 and up coming Model Y. There are aluminum suspension parts and aluminum castings for motors, gear boxes and electronics. Also aluminum alloy wheels.
Roy, the article clearly states it is not for those types of aluminum, it is specifically for the battery components which is a different alloy.
Agree. This is a quote from the Rueters article: "The U.S. Commerce Department has agreed to Tesla Inc’s request to waive 10 percent tariffs on imported aluminum from Japan used in the manufacture of battery cells at Tesla’s Nevada Gigafactory, government documents show."

Obviously Tesla provided all the info about this aluminum usage in the request of eliminating the tariff.
Aluminium foil content of the 21700 is ~1.7g. Some allowance must be made for scrap, but close enough for an estimate.

~4400 cells per Model 3, 400,000 annual production = 3.0 million kg.
I doubt the metal is imported, then foils produced.

Nippon Light Metal manufacture electrode foils.

The total could be a mixture of foil and metal. Who knows the truth when Tesla are involved.
Didn't Elon indicate in the early days that the Gigafactory should be producing these aluminum battery parts themself. All the Raw material would arrive in one end and finished product out the other was his claim
madhaus profile picture
The tariff application was not for the parts but aluminum in particular thicknesses and compositions with other alloys.
What were planed early years is one thing what actually would happen is another. Elon Musk and all CEO's of all other companies are allowed to change their original plans.

Elon Musk had a plan to make Falcon Heavy several years before the first launch in 2018. He did think about cancel it several times because it was too difficult and too costly to design and test the first launch, and he didn't know for sure if he can marketing it to potential customers. Finally, he went ahead to finish it after 5 years and $500 million of SpaceX money the Falcon Heavy was successfully launched last year.

Only the idiots would stick to his/her goals and the company went under because he/she didn't adjust to the reality.
"Only the idiots would stick to his/her goals and the company went under because he/she didn't adjust to the reality."

He would not need to adjust everything he talks about if he would be "real" in the first place before making these claims.
Blue Sky & Sunshine profile picture
Aren't all these tariffs basically just a stealth sales tax on Middle Class America? The other day Trump was bragging about how all those tariffs go to the US Treasury - roughly $100 billion / year if he carries out all his threats.

But these tariffs are ultimately, mostly paid by Middle Class Americans in the form of higher prices for consumer goods of every description, and for reduced employment from American firms that need to compete internationally..

And $100 billion/yr is what the Middle Class got from the $1 trillion/yr tax cut package that your friendly, always helpful GOP passed last year - the rest went to the wealthy, and big corporations.

Seems like the Middle Class share of the tax cut is being clawed back under cover of regulatory darkness.

madhaus profile picture
This has always been Trump's schtick, he's just doing it on a larger scale. He announces himself as exactly the opposite of what he really is, causes distractions, gets his business partners caught with the debt while he cashes out the equity, then swoops in to buy the parts at fire sale prices.

Anyone stupid enough to have voted for this serial criminal looter deserves the disdain of everyone who claims they value our formerly stable and reliable markets.
He’s trying to right the ship that greedy politicians have been pillaging for years, if we don’t get China in check, they will overtake us within the next 15 yrs all because we didn’t protect our own business interests and intellectual property. You think Trump is all smoke and mirrors??? Reality is that you don’t like him because he’s blunt and to the point, he tells you what he’s going to do and how he’s going to do it, he doesn’t lie to our faces and then screw us, he tells you he’s going to screw you and then people are shocked when he actually does it. You’d rather someone that tells you what you want to hear and the does whatever he wants. The only thing trump lies about is how great he is and he fudges numbers to make himself look good, but he’s never done anything that he didn’t explicitly say he was going to do. And as far as the market goes, are we looking at the same thing, all time highs, almost intuitive volatility.... this market is a traders AND an investors dream.
madhaus profile picture

You actually believe that nonsense. I feel sorry for you. You're a conman's dream come true, a mark who begs to have his pockets emptied over and over just to be part of the excitement. What's irresponsible of you is you helped put him in a position to loot the Treasury.
Renegade Investment Research profile picture
This is just a normal course of business activity ... but someone somewhere (media) wants to write about all things TSLA ...

From the article ...

The battery cells are assembled into packs which are the energy source for the Tesla Model 3 vehicle as well as energy storage products, Tesla said in its request. “Tesla is the only US manufacturer of these battery types and planned production of these batteries will increase exponentially over the next few years,” the company’s request said.

Tesla’s exclusion request specified several different width and thickness for aluminum sheets. Tesla said U.S. manufacturers cannot “meet the alloy composition or thickness requirements. Domestic producers also cannot meet the annual volume requirement.”

Sheesh ... planned production will increase exponentially over the next few years ... they still can't help themselves ... even in a formal submission for a tariff waiver ...
madhaus profile picture
What do you mean they can't help themselves? Seems like they just did.

Or do you consider the company in danger of bankruptcy because they didn't buy and retool Alcoa?
Renegade Investment Research profile picture

"planned production will increase exponentially over the next few years"

Grandiose statements seep into formal legal documents ... they don't just leak out on twitter or via "leaked emails" or via supporters (elektrek, insideevs,etc.)

To increase production you need to build more capacity. The China factory in Shanghai won't be producing a meaningful quantity (1000 / 2000 per week) until late 1Q-2020 at the earliest. To get that facility running to 5000 to 10000 per week 3Q-2020 at the earliest.

So that will "double" production ... let's be generous ... end 4Q-2020 ... in 18 months time.

Double isn't Exponential

So where is the next factory (or next two factories to get to exponential) ? Is the announcement of a European factory coming up in a few months. The Europeans factory won't be build as fast as the China factory, so you need to get a move on and start soon ...

This is just another example of the brain not connecting the dots to the reality of their business. Fake it 'til you make it.

Keith Nance profile picture
Lol. Clear signs of Tesla’s imminent bankwuptcy
Here's a clear sign or two or three. 13 plus billion of junk-rated debt. Annual losses every year of existance. stock way way down since the start of the year. Recent capital raise shares and debt underwater. High level employees leaving in droves leaving stock options behind. Service issues galore.400 plus competitors in China alone. Lawsuits galore.
@Keith Nance what is bankwuptcy?
HunterKiller89 profile picture
@Ruffdog it's like Bankruptcy for kids.
David G. profile picture
I didn't even realize we had tariffs on Japan.
djunh1 profile picture
neither did I to be honest.
The Tariff man is shooting tariff at anything that moves.
Stilldazed profile picture

Did you even bother to see when the Japanese aluminum tariff was enacted?
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