Only Teslas exempt from new auto tariffs thanks to 85% domestic content rule
Perceived favoritism and crony capitalism
- Many see the 85% domestic-content rule as a tailor‑made carve‑out that disproportionately benefits Tesla, whose CEO is close to the current administration and helped bankroll the campaign.
- Commenters argue this is classic “crony capitalism” or “state capture”: rules written with full knowledge of current supply chains so that only one major player qualifies in practice.
- Others push back that any automaker could reach 85% and that Tesla is simply being rewarded for having already invested in U.S. production, contrasting it with firms that offshored more aggressively.
Debate over “free market,” hypocrisy, and ideology
- Large subthreads argue that Trump and the modern GOP are not “free market” actors but open protectionists using tariffs plus deregulation at home.
- Long ideological tangents cover libertarianism, conservatism, civil rights, and “rule of law,” with accusations that all sides invoke principles selectively when it serves their tribe.
- Some note similar hypocrisy on the left (e.g., targeted state‑level taxes or exclusions aimed at Tesla/unions), arguing that “big government” also enables favoritism.
How the tariff/credit actually works (and confusion about 85%)
- Several participants point out the headline is misleading: tariffs are not a hard on/off switch at 85%; there’s a formula that prorates tariffs based on foreign content above a 15% allowance.
- There is confusion over metrics: NHTSA’s American Automobile Labeling Act lists no model at 85% U.S/Canada content; Kogod and other indices use different definitions (including corporate structure, USMCA content).
- Some suspect the government will choose whatever definition is needed to produce the desired winners and losers; others stress that origin accounting is complex and closely policed.
Effects on industry, supply chains, and consumers
- Commenters working in auto note that re‑engineering supply chains away from Mexico/Canada or Asia is slow, expensive, and sometimes practically impossible in the tariff’s timeframes.
- Expectation: new‑car prices rise, and used‑car prices follow, as exempt producers and second‑hand sellers raise prices to the new market ceiling.
- Some describe creative workarounds (e.g., “used” import schemes, accounting games) but warn that origin fraud is risky under an aggressive, vindictive trade regime.
Broader political and institutional concerns
- Many view this as one more data point in an emerging autocratic, oligarchic pattern: emergency powers stretched for tariffs, retaliation against companies like Amazon, and overt linkage between policy and personal loyalty.
- Others caution against over‑conspiratorial thinking, attributing much of the chaos to incompetence, short‑term politics, and structurally fuzzy laws that allow discretionary enforcement.