According to the letter, the tariff increase could lead to higher manufacturing costs for Tesla’s vehicles and reduce its competitive capacity.

While Elon Musk has emerged as one of President Donald Trump's most loyal supporters—backing his policies and contributing over $300 million to his reelection campaign—the tech mogul's companies are now fearful of the unintended consequences of the administration's aggressive trade measures.

As Wall Street grapples with the increasing likelihood of a U.S. recession, the Trump administration has gone to bat defending President Donald Trump’s stock market-slamming trade policies.