Tesla Gets Tariff Exemption For Japan-Sourced Aluminum Used In Battery Packs

Tesla has been granted a tariff exemption on aluminum it imports from Japan that is used in the manufacture of battery cells at its its Gigafactory in Nevada.

Reuters reports that the car manufacturer made the request to the U.S. Commerce Department in April, seeking an exemption on the 10 per cent tariff placed on imported aluminum. It revealed in the request that the material is produced by Nippon Light Metal and wanted a tariff exclusion for 10,000 tonnes annually.

In approving Tesla’s request, the U.S. Commerce Department said that aluminum “is not produced in the United States in a sufficient and reasonably available amount or of a satisfactory quality.”

Also Read: Trump Administration Denies Chinese Tariff Relief Requests From Tesla, GM, Uber

Tesla says it is the only U.S. manufacturer of such battery types and intends on increasing their production exponentially over the coming years. The tariff exemption applies for one year and, if aluminum tariffs remain in place longer than that, the electric car manufacturer will have to again request an exemption in 12 months’ time.

While the administration did grant Tesla a tariff exemption on aluminum imported from overseas, it did recently deny a request for the infotainment screen and Autopilot systems of the Model 3 to be exempt from 25 per cent tariffs on select Chinese-made goods.

President Donald Trump first introduced tariffs on aluminum and steel imported into the United States at the start of June last year. It was the first in a series of moves that triggered trade wars with Mexico, Canada, the European Union and China.