MAGA Customers Aren't Going To Save Tesla

Good morning! It's Tuesday, March 18, 2025, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. This is where you'll find the most important stories that are shaping the way Americans drive and get around.

In this morning's edition, we're looking at Elon Musk's ill-advised bet on MAGA customers to save Tesla along with Audi's possible plans to increase car prices in the wake of Trump's tariffs. We'll also talk about how Toronto is excluding Tesla from its EV incentives and how Honda plans to buy hybrid batteries from Toyota to get around those tariffs.

It's another busy day in Tariff Land, folks. Buckle up.

For years, Tesla (and its CEO Elon Musk for the most part) marketed itself as a fairly left-of-center automaker that cares about things like the environment, LGBTQ+ rights and other fairly progressive causes. Because of that, it brought in those very left-of-center buyers who wanted to portray themselves as tech-forward while also caring about the environment. That all changed when Musk swung hard to the extreme right of politics, not only in the U.S., but around the world. Since Tesla is pretty much seen as an extension of Musk himself, the perception around the brand has changed drastically and alienated most of its existing customers. 

Even folks who like their Teslas have to deal with the public shaming they now get every time they leave their homes — especially if they own a Cybertruck. Showrooms and Superchargers have also attracted "Tesla Takedown" protests across the U.S. as Musk becomes further dug in with his best friend Donald Trump. From Bloomberg:

[H]e appears to have completely misapprehended the symbolic value of Tesla's brand. Or, at the very least, he seems to have misunderstood his own capacity to change the nature of that value without also diminishing it.

At first, people seemed to think he might pull it off, even as the Trump transition team promised to end policies that benefited the company's business. Tesla's share price jumped to an all-time high of almost $480 in December, in part because investors seemed to assume that Musk's proximity to President Donald Trump was bound to benefit his businesses. Do you even need to worry about your customers' feelings when your company can just drink directly from the federal government's money hose?

It's beginning to look like the answer to that question might be yes, at least for Musk. Tesla's shares have since lost almost half their value, wiping out more than $150 billion of his personal net worth. Americans are socialized to view consumption as the front lines of politics, in part because it's easier to govern a populace that sees themselves as shoppers instead of political actors. But that's only true when the governing elites aren't also retailers who can be directly damaged by massive swings in personal purchasing behavior.

There's little indication that Musk will simply be able to switch his product from one ideological market to another of equal size, having now remade Tesla into a symbol of sneering anti-progressivism.

Tesla and Musk loyalists will say that this is just some sort of minor bump in the road toward some goal that exists on a higher plane of understanding than any of us are capable of. Perhaps that lies with Musk's promise of self-driving robotaxis, which Musk has been promising since I was a freshman in college.

Until that can happen, though, Tesla still has to sell cars, and its base is shrinking at a rather dramatic rate. Unfortunately for Musk, "owning the libs" is as easy as buying the latest gas-guzzler — no charging headaches or well-past prime vehicle line up required. 

If there's one thing Musk does have in his back pocket, it's influence over the most powerful person in the world. Just last week, after shares of Tesla plummeted on Wall Street, Musk enlisted Trump to do a sort of Tesla infomercial on the White House lawn. The President said he would buy one of Musk's cars and that the aforementioned Tesla vandalism is actually domestic terrorism.

Maybe a spokesman like Trump will be enough to get MAGAs interested in electric cars — specifically Elon's electric cars — but I've got some very serious doubts about that. 

Do you all want to know the real impact of tariffs on the consumer? This is a prime example: Audi is planning it pass the costs of import tariffs onto U.S. customers through pricing increases. It also added that we can expect a decision sometime this year as to bringing production to North America. Who knows if that part of it will actually happen, though?

Right now, Audi doesn't have any factories in the U.S., making it one of the automakers most exposed to Trump's tariffs. Compounding the issue is the fact that it builds its very popular Q5 crossover at a plant in Mexico — where it employs over 5,000 people. From Reuters:

Audi's finance chief Juergen Rittersberger said the company was considering "the extent to which we will have to pass on at least some of the tariffs to our customers in the form of price increases".

He said the goal was to find a "sweet spot" between price increases and production volume adjustments, something the group was now exploring in more detail in the coming weeks.

Currently, the European Union is in talks with the U.S. to try and find a solution to this tariff situation, but who knows how the hell that will go with the Gruesome Twosome of Trump and Musk at the helm?

Audi — and the Volkswagen Group overall — is in a bit of a tough spot right now. Earlier this week, it announced it was cutting 7,500 jobs by the end of the decade in an effort to raise margins and lower costs. That number brings the planned cuts by VAG to just below 48,000 workers (nearly 8 percent of its global workforce).

Toronto is cutting Teslas out of the financial incentives it offers on vehicles purchased as taxis or rideshare vehicles because of trade tensions with the U.S. and CEO Elon Musk. The Canadian city is giving folks who purchase EVs as for-hire vehicles a reduction in licensing and renewal fees until the end of 2029, but Teslas are no longer included in the cost savings. 

Olivia Chow, Toronto's mayor, made the announcement at a press conference on March 17. From Reuters:

"The vehicles for hire, like taxis, will have to find a different kind of car," she told Reuters after the news conference. "There are other electric cars they could purchase."

The exclusion will continue until trade issues with the U.S. are resolved, she said.

[...]

"We have certainly said that if you want to buy a Tesla, go ahead, but don't count on taxpayer money to subsidize it," she said.Chow said the financial impact of the move would not be large."It's more symbolic," she said.

Chow said the financial impact of the move would not be large.

"It's more symbolic," she said.

Chow told the outlet that the decision was made as an explicit target and response to the actional of Musk, who has been a top advisor to President Trump since he took office in January. Trump has, of course, called for the annexation of Canada and imposed tariffs on Canadian goods.

Honda is planning to buy up batteries for its hybrid vehicles from Toyota's new $13.9 billion battery complex in Liberty, North Carolina in an effort to get around the added costs of Trump's tariffs. The plan is for Honda to buy enough of Toyota's U.S.-made batteries to supply about 400,000 of its vehicles. That's enough for all of the hybrids Honda plans to sell in the U.S. during the 2025 fiscal year which starts next month. From Automotive News:

The first production batteries from Toyota's 1,800-acre, 30 gWh battery complex are expected to come off the first line this spring. The massive facility, which Automotive News toured a year ago, will ultimately produce two sizes of battery cells — cellphone-size for traditional hybrids, and VHS tape-size for plug-in hybrids.

The complex is expected to be complete by 2028 and employ an estimated 5,100 people. Seven buildings, all dedicated to making batteries, with two production lines planned for each: 10 lines will build battery packs for future EVs and plug-in hybrids; four will build battery packs for gasoline-electric hybrids.

Right now, Honda sources batteries for cars it assembles in the U.S. from Japan and China, but those operations are going to be upended by Trump's tariffs. The Japanese automaker also decided to move its next-generation Civic hybrid production from Mexico to Indiana to avoid the tariff issue.

On this day in 1969, the U.S. bombed Cambodia for the first time at the direction of President Richard Nixon and National Security Advisor Henry Kissinger. Here's hoping that wherever those two are, they're having a truly awful time. Here's more from History.com:

U.S. B-52 bombers are diverted from their targets in South Vietnam to attack suspected communist base camps and supply areas in Cambodia for the first time in the Vietnam war. While meant to shut down reinforcements for enemy Viet Cong, the bombs terrorize innocent civilians in a country that was still officially neutral in the Vietnam War.

President Nixon approved the mission—formally designated Operation Breakfast—at a meeting of the National Security Council on March 15. This mission and subsequent B-52 strikes inside Cambodia became known as the "Menu" bombings. A total of 3,630 flights over Cambodia dropped 110,000 tons of bombs during a 14-month period through April 1970.

This bombing of Cambodia and all follow up "Menu" operations were kept secret from the American public and the U.S. Congress because Cambodia was ostensibly neutral. To keep the secret, an intricate reporting system was established at the Pentagon to prevent disclosure of the bombing. Although the New York Times broke the story of the secret bombing campaign in May 1969, there was little adverse public reaction.