Tesla's price reaches its lowest level since 2017 over tariff panic between the US and China

Tesla Inc., one of the most exposed US companies operating in China, saw its share price drop 6.3% to $ 224.50 on Monday. This was the lowest intraday level of the stock since January 2017.

Tesla shares closed the day at $ 227.01, down 5.2%. He suffered further casualties after office hours and dropped to $ 226.25, down 0.33%. He led the Bloomberg global automaker index of 27 companies, down 1.6%, reaching its lowest intraday level since January 7th.

Analysts have noted that 2019 already had the merit of becoming the worst year in Tesla's brief history. The only year in which the stock has seen an annual decline was 2016, when stocks fell 11%.

Tesla was beaten after China lifted a $ 60 billion tariff on US imports on June 25 from June 1. President Donald Trump should once again pressure this escalation by announcing his intention to impose a new 25% tariff on all remaining imports from China. about $ 300 billion.

Although tariffs do not yet include motor vehicle imports, the intensification of the trade war means that Tesla's EVs could become more expensive in the coming months.

"Basically, China is increasingly concerned that a protracted trade dispute could have a significant negative impact on Tesla's sales and auto margins after the recent rejection of their tariff-free request." "said Garrett Nelson, an analyst at CFRA.

The growing trade war against China, triggered by Trump, also means that Tesla must accelerate the construction of its Shanghai Gigafactory plant to mitigate the damage caused by higher tariffs. Gigafactory is expected to produce more than 2,000 Tesla electric vehicles by the end of the year.

Tesla is also facing the Chinese auto market, which is suffering the worst collapse of its generation. Sales have fallen in each of the last 11 months, with trade tensions, a slowing economy and more general consumer trends weakening demand.

Close up of the Tesla logo on a charger in a Supercharger fast battery charging station for the Tesla Motors electric vehicle business, in the Mountain View town, in Silicon Valley, on August 24, 2016. Photo: Photo of Smith Collection / Gado / Getty Images

Tesla, however, was not the only builder to have problems because of Trump's trade war. BMW AG and Daimler AG, the largest importers of US-built vehicles in China, saw their shares in Frankfurt close by 1.2% and 3.3%, respectively. General Motors Company lost up to 3.8% while Ford Motor Company fell 3.3%.

China is Tesla's largest market and a key market for Tesla's future profitability. Tesla has earned more than $ 2 billion in China in 2018, while doubling its sales.

It is estimated that Tesla sold 20,000 electric vehicles (EVs) to China last year, its most popular model being the X model. The world's three largest supercharging stations are located in China.