Trump Tariffs Are Causing Decline In EV Battery Demand, Says Tesla, General Motors Supplier LG

South Korea's LG Energy Solutions, which is a battery supplier for U.S. automakers like Tesla Inc. (NASDAQ:TSLA) and General Motors Co. (NYSE:GM), says that President Donald Trump's tariffs are slowing down EV battery demand.

What Happened: "U.S. tariffs and an early end to EV subsidies will put a burden on automakers, potentially leading to vehicle price increases and a slowdown in EV growth in North America," the company's CFO Lee Chang-sil said during a call with investors, Reuters reported on Friday.

The company, which is one of the few non-Chinese producers of LFP batteries, says it will boost energy storage production and convert some U.S. EV production facilities to manufacture energy storage systems so it can offset EV demand, the report suggests.

Why It Matters: The news comes in as Trump's tariffs have had a big effect on the auto industry in the U.S., with major auto companies announcing billions in additional costs due to the tariffs.

Tariffs, however, are only a part of the picture, as the administration's Big Beautiful Bill law has axed the $7,500 federal EV credit as well as announced relaxed CAFE norms, affecting ZEV credit sales for EV makers like Tesla and Rivian Technologies Inc. (NASDAQ:RIVN)

Elsewhere, Panasonic Holdings Corp (OTC:PCRFF) (OTC:PCRHY), a battery supplier for Tesla, also announced delays to ramp up production in the Kansas battery plant due to Tesla's sales slump.

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