Tesla has been promising an expansion in Turkey for a while now and it was going forward as of recently. But they have now reportedly put a stop to their expansion plan due to new trade war tariffs.
Despite the fact that Tesla is not officially in Turkey, there are many Tesla owners in the country who went to the trouble of importing the electric vehicles themselves and having them operate without access to services.
For years now, they have been asking Tesla to expand in the country with stores and service centers.
Back in May, CEO Elon Musk finally said that Tesla planned to launch in Turkey later this year:
Towards end of next year. Btw, planning to launch Tesla in Turkey later this year. Love your country & will be there in person for the launch.
— Elon Musk (@elonmusk) May 11, 2018
The plan was apparently moving forward with reports that Tesla was planning to open a store and service center in Istanbul.
But now, local media reports that Tesla pulled the brakes on the plan following significant tariff increases as part of the escalating trade war that Trump’s administration has been waging with many countries.
We contacted Tesla for a comment and we will update if we get an answer.
In August, the U.S. announced new tariffs on Turkey’s steel. A week later, Turkey retaliated with a series of new tariffs, including 120 percent on American cars.
The new tariffs are likely significantly affecting the demand for Tesla vehicles in the country and therefore, it would be difficult for the automaker to justify investing in the market.
Earlier this year, Tesla said that its sales in China were also affected by the escalating trade war as the country answered to Trump’s Chinese tariffs with a 40 percent tax on American cars.
Tesla has accelerated its plan to establish Chinese manufacturing capacity to get around the tariffs.